Despite speculations that facebook’s Libra Project may have been distorted because of derailed partnerships, they have unveiled their new cryptocurrency, Libra today as envisaged. Today Facebook released its white paper with an explanation on Libra and its testnet for working out the kinks of its blockchain system before a public launch in the first half of 2020. Also, Facebook is launching Calibra, a subsidiary company that handles its crypto dealings and protects users’ privacy by way of separating Libra payments from Facebook data (users’ identity won’t be tied to publicly visible transactions ) so it can’t be used for ad targeting.
Some sources had implied that facebook’s crypto plans had nothing to do with cryptocurrency or others that it may be a political move. This did not affect Facebook’s daring move that has created a global digital currency for promoting financial inclusion for the unbanked and it actually has more privacy and decentralization built in than many expected. With the official announcement and unveiling, many unavoidable controversies and confusion will definitely be cleared.
Libra coin is a special type of cryptocurrency, as the U.S. dollar, the stablecoin’s value should not change much compared to some stable real world asset. It is held by custodians chosen by the Libra association and backed by actual fiat money and equivalents. Libra allows users to buy things or send money to people with nearly zero fees. One can anonymously buy or cash out one’s Libra online or at local exchange points like grocery stores, and spend it using interoperable third-party wallet apps or Facebook’s own Calibra wallet. The Calibra wallet will be built into WhatsApp, Messenger, and its own app as announced. Notably, the full control of Libra is spread amongst facebook and the other founding members of the Libra Association including Visa, Uber, and Andreessen Horowitz who’ve been confirmed to be investors of at least $10 million each into the project’s operations. Facebook gets just a single vote in its governance. Facebook/Calibra and other founding members of the Libra Association will all earn interest on the money users cash in that is held in reserve to keep the value of Libra stable.
Facebook playing patiently as it is first pulling payments into its online domain other than trying to dominate Libra’s future or squeeze tons of cash out of it immediately. During a briefing at San Francisco’s historic Mint building Facebook’s VP of blockchain David Marcus explained the company’s motive. “If more commerce happens, then more small businesses will sell more on and off the platform, and they’ll want to buy more ads on the platform so it will be good for our ads business.”
Also newly introduced is the Libra Blockchain which is the new type of blockchain, primarily designed to support the Libra cryptocurrency, but one that also allows anyone to build smart contracts on top of it; this is similar to Ethereum. The Libra association will promote the open-sourced Libra blockchain and developer platform with its own Move programming language plus sign up businesses to accept Libra for payment and even give customers discounts or rewards.
Facebook had tried in 2015 with Messenger Payments, but the feature which was meant to allow users to send and receive money didn't catch on. Now Facebook has finally revived its old dream of building a payment network. For video footage click here
Credits- Josh Constine, Stan Schroeder,
Published at: 1 week ago
Published at: 2 weeks ago
Published at: 2 weeks ago
Published at: 1 month ago