Facebook unveiled its long awaited cryptocurrency plan on Tuesday. "Project Libra" is a new form of digital money designed by billions of people to use apps and social networks. If the plan is successful, users will soon be able to shop and send calls known as Libra-on Messenger and Instagram, as well as to use at various merchants such as Uber, Spotify and MasterCard.
Facebook did not give specific details about when consumers would hold the call, but the management suggested that it be first distributed to Messenger and WhatsApp in mid-2020.
In addition, the company has launched a new digital wallet called Calibra that operates as a separate subsidiary and provides users with a way to store and spend libra. Digital Wallets are not publicly visible for months, display your Libra value in local currency, and send money similar to Venmo, a popular digital wallet.
Facebook provided a design image of Callebra. The Libra included a three way symbol that served as a dollar sign in Libra.
Facebook's Calibra Digital Wallet app. Facebook photo courtesy
According to David Marcus, a former executive of PayPal, the project librarian for Facebook, one of the main goals of the project is to reach 1.7 billion people around the world who have no access to the banking system is.
"It is unusual for the Internet to have no protocol for money," Marcus says. propertyHe added that Project Libra will increase competition for financial services as well as increase access to capital.
As Facebook has led the project, the company has been a member of dozens of companies and nonprofit associations that manage calls together through the Swiss Foundation. Corporate members of the organization, known as the Libra Foundation, will need to donate at least $ 10 million to help boost the exchange rate. You are expected to receive a small amount of Libra to try out Libra.
Initial members are 27 partners, including Facebook and Visa, MasterCard, PayPal, CoinBase, Andreesen Horowitz, and venture capital companies such as Union Square Ventures. Marcus hopes that up to 100 partners will enter the cabin by the time the call is made public, at which time the group will formulate an official charter that sets the right to vote and other rules.
Like other block chains, the Libra block chain provides a tamper-proof record of transactions in the network. Unlike Bitcoin and other public blocks, however, only authorized organizations (in this case, base members) can run the node.
Members will continue to supply Libra as needed. That is, it will issue a new Libra if necessary and destroy digital currency when people are relieved.
In addition, Member States must provide preliminary funding to maintain a stable currency value. To avoid the notorious variability of cryptocurrencies such as Bitcoin, each unit of Libra is supported as a one-to-one in a basket consisting of dollars, pounds, Euros and Swiss francs.
An unsure bully
The launch of Project Libra faces unprecedented research by regulators and is fighting to restore user confidence after a series of personal information scandals. Block chains of open source calls are programmed in a new language developed by Facebook called Move. In addition to acting as a transactional record, it is described as a "layer of innovation" in which partners invite third parties to build smart contracts and other block-chain-based services.
At the start of the call, Facebook said it would treat customers as financial services. According to Dante Disparte, head of the Libra Association, US customers will be faced with the so-called "Know Your Customer" requirement. In other words, you must provide detailed personal information in order to use the service.
This raises the question why Facebook is leading the project libra for the first time. Based on conversations with Facebook executives, the company seems to have had the opportunity to block the remittance market by providing users with an easy and affordable way to transfer money across borders.
Disparte noted that many low-income people have already used WhatsApp to send receipts from local currency exchanges as part of the process. He says the project can be done incredibly quickly by building the ability to transfer money in the form of Libra.
The new service provides new opportunities for advertising and ecommerce on Facebook. Specifically, your company can show ads on WhatsApp and Instagram, and use Libra to invite people to pay for goods and services directly within the app. By doing so, not only will Facebook be able to collect new data about your shopping behavior, but you can also make more money from your ads.
But Facebook's reputation for user privacy is low and Twitter skeptics have already announced the new Libra currency "Panopticoin". Facebook and its partners claimed they could offer a new way to track online users.
Facebook said its Caliber Wallet will be a standalone product and will not import data from other sites (such as your friends) unless you allow the company. Facebook argues that the Libra base structure is just one of dozens of companies building a new global currency.
New coins on the block
There are also questions about whether Facebook or anyone else can begin an ambitious multi-faceted effort as the previous attempt to build a consortium in the field of block chains collapsed.
Especially when the government views the new Libra currency as a way to destroy its fiscal policy, the initiative with regulated mines is prevalent. But Marcus contends that this is not a problem, considering that the country can not avoid the proliferation of cryptocurrencies and that many people will welcome the libra in a more efficient way for those who send money.
In the meantime, it is also unclear how Facebook partners will benefit from the project. For global tech companies Uber and Spotify, executives have the opportunity to reduce payment processing costs and reach new customers without credit cards.
Financial companies offer Project Libra as an opportunity to find new business opportunities while providing new challenges. According to Andreesen Horowitz's Kathryn Haun, the business that runs a node is not about fetching data, but about being at the forefront of financial innovation.
Ultimately, consumers decide whether Facebook's grand gambling will succeed or fail. If currency usage is more widespread and more useful than payment options like credit cards, debit cards, Venmo and Bitcoin, it can transform many of the technology and financial industries.
Then once again, you can encourage others, especially Apple or Amazon, to start their decryption network.
Early versions of this story misrepresented the title Dante Disparte.
More stories to read property:
Five things you should know about Facebook's new password cracking
– Did the SEC's ICO lawsuit against Kik go too far?
– Why cutting codes can make a big difference in the media environment
Scott Kupor of Andrisen Horowitz
There is a place where the government starts to break down Facebook.
– Listen to new audio briefings, property 500 per day
follow property Stay up-to-date with the latest news and analysis on Flipboard.