Facebook’s cryptocurrency Libra: The token of the future? | Saradar Bank | Banks in Lebanon | Personal Banking | A Digital Bank

Facebook’s cryptocurrency Libra: The token of the future?

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If you look around you can find that even though history seems to repeat itself, technology has been the only evolving constant. There’s no hesitation about the importance of tech development and research. Tech has been the top driver of opportunity, revenue & production, and overall development. Most importantly, with new tech disrupting all kinds of industries, the world is shaping differently- today more than ever the concept of a global market is actually within our grasp. Grab your popcorn, because the founders of global connectivity Facebook have introduced yet another radical technology that might reshape our perception of currency entirely: the new global currency - Libra.

If you’ve been following up on the world of cryptocurrency, then you might understand the global challenges in privacy, regulation, and trust- if you’re not caught up, here’s a quick crash course on the spectacular burst of the cryptocurrency bubble. Libra is not only being introduced as the newest cryptocurrency on the bloc (pun intended- where my crypto geeks at?), it is coming in with solutions to the challenges, positioning itself as a new age global currency and infrastructure. Here’s what you need to know about Libra:

 

Of course- Facebook is behind this:

After a year of development, the Facebook team introduced their newest cryptocurrency Libra. Facebook has set up a governing entity that will control and regulate Libra dispersion and activity around the world, named the independent Libra Association: a governing group composed of corporate giants like Mastercard, Paypal, and Ebay, venture capital Firms like Thrive Capital and Union Square Ventures, and international NGO’s like Mercy Corps and Women’s World Banking. Facebook charged each founding member a fee of $10 M USD for their right to govern this currency. Even though the Libra Association is independent, it has promised to work with government entities to ensure safety and regulation. This promise is something other Cryptocurrencies seem to lack (Bitcoin was actually created by an unknown person that goes by the name of Satoshi Nakamoto, who could be Tupac for all we know…).

 

Libra is backed by real assets:

The economic and social clash with cryptocurrencies like bitcoin is that unlike real currency they are not backed by actual assets- Bitcoin derives its value from the market, meaning the value of Bitcoin is formed by how frequently accepted it becomes. Libra founders on the other hand, have backed their currency with actual assets, low risk trust funds, and government bonds that are already deposited. Surely, this means the value of a Libra pound will always be stable and pegged to an actual currency. In simpler terms, 1 Libra pound will act as 1$; the difference is, while 1$ might not be accepted as means of transaction in some countries, Libra is destined to be accepted globally.

 

Libra goes global in 2020:

The Libra Association has set 2020 as their date of releasing the currency to the world. In their white paper report, the association explained that Libra is going to be accessible around the world; and as of 2020, everyone should be able to access this currency via apps on their phones or from local convenience stores (the latter might not be the case so soon for you and I my Lebanese friends). Pushing global accessibility even further, Facebook and the association are developing an open source software by the name Calibra that works on integrating your Libra wallet in social media platforms like Facebook, Instagram, and Whatsapp. This integration bypasses “the middleman”.  In the white paper, the association stated that they want Libra transactions to be as safe, accessible, and as simple as sending a text to a friend. Officially, this might mean you can transfer money to anyone across the globe with low to non-transactional fees, optimum safety, and very minimal restriction. Sound likes a currency from Blade Runner right?

 

Libra is the future, but is it safe?

The opportunities of Libra are endless. Think about all the airport exchange brokers that you’ll never see again, the money you’ll never lose on a trip, and the international subscriptions you can now subscribe to (IP changing peeps, I know you’re particularly excited about this one). However, there are some speculations on whether Facebook is the right entity to lead on the governance of such a global currency. With the most recent privacy scandals along with how freakishly intricate targeted ads have been performing, there is a big chance that Facebook might use financial data to feed ad algorithms even further. Even though you can choose to use Libra under any profile name, it will still be traced back to you. Facebook addressed these speculations head on by creating Calibra, a subsidiary owned by Facebook that will handle all Libra related matters isolating financial data from social data. This might put the speculations to rest if Calibra truly ends up acting as a separate entity, but we’ll only know that once Libra is on the market.

 

With innovations such as Libra emerging daily, our world is truly reaching a solid understanding of global citizenship. Soon, we’ll be able to pay in Libra anywhere, anytime, for almost anything. Whether Libra is going to be the currency of the future, or other cryptocurrencies will soon follow their lead, the only assured takeaway is that we’re at a time of digital monetization. Maybe, just as most of us have digitized our memories, diaries, and daily interactions, this might be the right time to think about digitizing our money.

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