‘Libra’ is a cryptocurrency that has been announced by Facebook, the American social media company, in which users are going to be able to secure their financial assets on their mobile device, which should be simple and intuitive.
As ‘Libra’ is a permissioned blockchain digital currency proposed by Facebook, the project, currency, and transactions are to be managed and cryptographically presented to the ‘Libra Association’, a membership organization that is founded by Calibra (the subsidiary of Facebook) and 27 others are to be managed through payment, technology, telecommunication, online marketplace, nonprofits, and venture capital.
Morgan Beller, the Co-Creator of Libra and Head Strategy at Calibra, started working on cryptocurrency and blockchain at Facebook in 2017, and she was basically the only person who was working on Facebook’s blockchain initiative.
Likewise, David A. Marcus, the Vice President of Facebook, has moved from Facebook Messenger to a new blockchain division in May 2018. By February 2019, there were more than 50 engineers working on the project.
Check out the official tweet by Libra in their official page on Twitter:
On July 15, 2019, Facebook announced that the currency is not going to launch until all the regulatory concerns have been met which has the “appropriate approvals”.
Similarly, on September 18, 2019, Mark Zuckerberg, the Founder, Chairman and Chief Executive Officer (CEO) of Facebook, told the lawmakers in a meeting with top Senate Democratic leaders that Libra would not be launched anywhere in the world without first gaining approval from the regulators of the United States.
Libra is a simple global currency and financial infrastructure which enables billions of people.
The main motive of the currency is to reinvent money and transform the global economy. So that people from all over the world can live their lives better.
In fact, Libra is for everyone, where moving money around the world should be as easy and cheap as sending a text message or sharing a picture. No matter wherever people live, what they do, or how much they earn.
- Libra will be accessible to anyone with an entry-level smartphone and data connectivity.
- It is supported by a reserve made to keep its value stable.
- Libra transactions are fast and easy, no matter where people are sending or spending their money.
- Libra is a global cryptocurrency which will be available around the world.
- It is a cryptocurrency that is built on a blockchain that is designed with security in mind.
- It will also develop an ecosystem of products and services which made to help people using Libra in their everyday lives.
From Where Does the Name ‘Libra’ Has Been Taken?
As we all know, the term ‘Libra’ is an astrological or zodiac sign which symbolizes ‘justice’. It is an ancient Roman unit of weight, and it means ‘free’ in French, though it is spelled as ‘libre’.
Why Does Facebook Want to Have its Own Cryptocurrency?
Actually, this is not a cryptocurrency of Facebook; in fact, Facebook has its own interest in digital cash which introduces ‘Libra’.
Check out the official post by Libra in their official page on Facebook:
As social media ran a virtual currency, known as Credits, for about four years for making payments on games played on Facebook, Zuckerberg, in May 2017, said that sending money online should be as simple as sending photos.
However, Libra is designed for making it easier and cheaper for people to transfer money online, which might fascinate new users to the social network.
How to Get Started?
To get started, people will be able to convert their local currency into Libra. They will also be able to convert it back into their local currency when they want to withdraw.
The Libra Association has been, previously, established by Facebook to manage the currency which was founded by 28 members in Geneva, Switzerland.
Libra Association members currently include:
- Payments: Mastercard, PayPal, PayU, Stripe, Visa Inc.
- Technology and marketplaces: Booking Holdings, eBay, Facebook’s subsidiary Calibra, Farfetch, Lyft, MercadoPago, Spotify, Uber
- Telecommunications: Iliad SA, Vodafone
- Blockchain: Anchorage, Bison Trails, Coinbase, Xapo
- Venture capital: Andreessen Horowitz, Breakthrough Initiatives, Ribbit Capital, Thrive Capital, Union Square Ventures
- Nonprofit and multilateral organizations, and academic institutions: Creative Destruction Lab, Kiva, Mercy Corps, Women’s World Banking
However, the association hopes to expand to 100 members with an equal amount of vote, while Facebook expects to “maintain a leadership role through 2019”.
Hence, the supply of Libra will grow or shrink based on how popular it is. If people want to use Libra, the association will buy more of the underlying assets and create, or “mint,” new Libra. If people want to cash out of Libra, the association will pay them and destroy, or “burn,” the proper amount of Libra.
How is Libra Different from Other Cryptocurrencies?
As Libra is similar to the other cryptocurrencies, such as Bitcoin and Ether, it exists entirely in digital form. People will not be able to get a Libra note or coin. And like other cryptocurrencies, Libra transactions are recorded on a software ledger, known as blockchain, which confirms each transfer. The Libra blockchain will be managed by the founding members in the early stages but evolve into a fully open system in the future.
However, the value of Libra will be much more stable than the value of Bitcoin and other major cryptocurrencies, as Libra “will be effectively linked to a basket of fiat currencies”.
However, Facebook adds:
“Calibra will use Facebook data to comply with the law, secure customers’ accounts, mitigate risk and prevent criminal activity”.Facebook
So, after the network is launched, Facebook says that its role and responsibilities will be the same as those of any other founding member.
Likewise, Calibra says explicitly that customer data will not be used to improve ad targeting. In a press release, it has been said:
“Calibra customers’ account information and financial data will not be used to improve ad targeting on the Facebook Inc. family of products.”
It has also said that Calibra will seek customer consent before using Facebook data to improve features.
You can check the official website here: https://libra.org/en-US/