Following months of speculation, Facebook have released details of their official whitepaper to the general public via major media outlets, outlining their plans to create a global currency called Libra to operate within a financial-blockchain infrastructure that they claim will empower billions of people.
The project is backed by a consortium of companies known as the Libra Association & Council who will each run a validator node on the network and serve in a governance role – thought to be similar to the blockchain-validation model currently utilised by EOS – and raises possible concerns over centralisation. Members of the Libra Association include Mastercard, Visa, Uber, Spotify, Vodafone, eBay, PayPal and Coinbase.
Internal or External Currency?
The Libra currency is being promoted as a digital stablecoin, backed by a range of assets including a basket of various fiat currencies and U.S. Treasuries which, despite rising evidence to the contrary, are still seen as relatively safe financial products and a means to prevent excessive fluctuations in the price of Libra.
While initially promoted as way to transfer value internally across the Facebook umbrella of companies, the choice of partners suggest a larger vision is behind the project. A Facebook spokesperson told the Financial Times that “Just as people can use their phones to message friends anywhere in the world today, with Libra, the same can be done with money – instantly, securely and at low cost.”
Ex-Facebook employee and current Co-founder of Morgan Creek Digital Assets, Anthony Pompliano, highlighted the project’s positive aspects and shared the potential opportunity offered by the development.
Other industry insiders are already looking beyond Facebook to gauge what these “opportunities” will equate to for other major corporations. Tyler Winklevoss from the Gemini Exchange, for example, believes it is just a matter of time before other FAANG companies – Facebook, Amazon, Apple, Netflix, Google – follow suit and produce their own digital currencies.
