Facebook To Launch Their Own Cryptocurrency
After weeks of speculation and dozens of rumours online, Facebook has finally admitted to their future plans regarding blockchain technology. The company has announced that its currently developing a new type of global cryptocurrency, called Libra, which will be based on their very own underlying blockchain-based network called Calibra.
Unlike other types of cryptocurrency, Libra will not be a speculative asset, which means that its value will be based on a tangible reserve of assets. The only difference being that in this case, the assets will be provided and maintained by companies and involved parties, rather than governments with vested interests.
Once launched, people will be able to use Libra as payment method for both online and offline services, which also means the production of some sort of physical offline method of interaction. The initial target demographic for this type of cryptocurrency will be people in developing countries that don't have access to traditional banking systems. Once it gets up and running, this decentralized form of payment will also be used to support all types of financial products and services— such as banking, personal loans, and/or commercial credit.
To ensure the decentralised nature of the program, Facebook has created a non-profit Libra Association that has 27 other partner organizations. These include venture capital firms, NGOs, crypto firms, as well as service providers for corporate, financial, telecommunications, and technology services. Some of the big names in this list are Mastercard, Visa, PayPal , Spotify, Uber, Lyft, Vodafone, Stripe, Coinbase and eBay. Those organizations will not only have a say in the development of the currency and its regulations, but will also contribute to a central Libra Reserve. This reserve will play the role of a central asset pool that will provide a real world value to every unit of the currency. This way, they will have an equal share in the profit and loss equation for the currency.
Facebook will also open its own digital wallet, called Calibra as well. You will be able to use it just like Google Pay, or PayTM, with the difference being that it will be accessible via Facebook Messenger and WhatsApp as well, in addition to a standalone app. Facebook is hoping that more companies will want to become part of this network, considering its stable nature.
To remove any doubts about their sincerity, the company has made the Libra blockchain open source under an Apache 2.0 license, so that people can create new applications based on the code and as a result help in the adoption of this new type of currency. We can't wait to see if they succeed.