Facebook Planning to launch virtual cryptocurrency Libra- Permission Blockchain, Association, Software
American Social Media conglomerate Facebook is planning to launch its proposed virtual cryptocurrency Libra by 2020(projected). The complete project is controlled by “LIBRA ASSOCIATION”. It is a membership association founded by Calibra( Facebook’s subsidiary) and 27 others engaged in payment, telecommunication, venture capital, online marketplaces, technology, and non-profits. Calibra is recognized as a digital wallet holds Libra currency. It seems to be an e-wallet like Paytm that holds Libra instead of Indian Rupee.
Libra Association consists of 28 members in Geneva, Switzerland.
Payments: Vise Inc., Stripe, Mastercard, PayPal, PayU
Telecommunication: Vodafone, Illiad SA
Venture Capital: Ribbit Capital, Breakthrough Initiatives, Union Square Ventures, Thrive Capital, Andreessen Horowitz
Online marketplaces and Technology: Calibra( Facebook’s subsidiary), Uber, Spotify, Lyft, eBay, Booking Holdings, Farfetch, Mercado Pago
Non-profits Organizations: Women’s World Banking, Creative Destruction Lab, Mercy Corps, Kiva
Libra Association will create new Libra Currency units based on global demand. The currency units can be redeemed for conventional currency when currency is in the retired stage. It decides to be a unique method for payment. It aims to be more efficient with low cost and more accessible to ordinary users, business personnel especially for unbanked people.
The currency applies a certain remittance charge(7 percent) to send money internationally. During the transaction process intermediaries pocket around $50 billion per annum. Facebook’s digital payment mode aims the $613 billion overseas money transaction market.
Libra white paper states “Moving money around globally should be as easy and cost-effective as— an even more safe and secure than—- sending a text message or sharing a photo, no matter where you live, what you do, or how much you earn.”
Both Bitcoin and Libra operate on Blockchain technology. Blockchain technology refers to a decentralized ledger of transaction. The technology uses critical math functions that make it almost incorruptible.
Only members of the Libra Association can use the blockchain technology. Libra is also aiming to approach permission less proof-of-stake within coming five years; although they also said that no solution exists “that can deliver the scale, stability, and security needed to support billions of people and transactions across the globe through the permissionless network.”
Now let’s have a look into Libra Software.
Virtual digital currency Libra’s source code is in Rust as open source. Apache License published the software on 19th June 2019.
Libra is facing criticism from the central bank as they need clarification for the implementation of Blockchain Technology and the use of cryptocurrency. According to report Maxine Waters, Chairperson of United state House Committee on Financial Services Committee requests Facebook to pause launching of the cryptocurrency.
She explained recent scandals in support of her request. She said “The cryptocurrency market currently lacks a clear regulatory framework to provide strong protections for investors, consumers, and the economy. Regulators should see this a wake-up call to get serious about the privacy and national security concerns, cybersecurity risks and trading risks that are posted by cryptocurrencies.”