The highly anticipated Facebook Libra crypto project has finally been demystified, with the social media giant releasing the Libra white paper today.
Conveniently touted as the platform to provide a simple global currency and financial infrastructure accessible to billions of unbanked people, the Libra project will eventually be a cryptocurrency, built on a blockchain and having properties sampled from both the Ethereum and Bitcoin blockchain frameworks. According to the white paper, the Libra project is being developed to be:
“A NEW DECENTRALIZED BLOCKCHAIN, A LOW-VOLATILITY CRYPTOCURRENCY, AND A SMART CONTRACT PLATFORM THAT TOGETHER AIM TO CREATE A NEW OPPORTUNITY FOR RESPONSIBLE FINANCIAL SERVICES INNOVATION.”
Contrary to critical opinions before the unveiling — and especially of those who opined that Facebook’s GlobalCoin, officially referred to as Libra, has nothing to do with blockchain — the white paper has clearly identified the project as one to be built on the backs of permissionless consensus. It appears the Libra coin will be a stablecoin of a sort, backed by real-world assets in a reserve.
The Libra team believes there isn’t any solution among the 2,000 cryptocurrency or so projects in existence today that is of a permissionless nature that could serve a global scale. It notes in the white paper that:
“THE CHALLENGE IS THAT AS OF TODAY WE DO NOT BELIEVE THAT THERE IS A PROVEN SOLUTION THAT CAN DELIVER THE SCALE, STABILITY, AND SECURITY NEEDED TO SUPPORT BILLIONS OF PEOPLE AND TRANSACTIONS ACROSS THE GLOBE THROUGH A PERMISSIONLESS NETWORK.”
This invariably puts Libra in the class of most cryptocurrency projects offering financial services in the decentralized space and may, in fact, prove to be a formidable competitor, should the underlying apprehension due to privacy concerns — given the history of the parent company — be easily dismissed.
However, on the bright side for Facebook, along with its allies, they have a composite huge and possibly interwoven user base, making it convenient for user-transition between platforms through the cryptocurrency. According to the white paper, over 29 business mammoths with trillions of US dollars in valuation were listed as Founding Members of its Libra Association — the governing helm of the project. It further plans to increase this figure to around 100.
Facebook has also revealed the launch of a cryptocurrency wallet Calibra in 2020 which will invariably give over 2.38 billion monthly active users access to use the Libra cryptocurrency for transactions across its messaging infrastructure.
Now the world will just have to wait and follow the developments of the Libra project closely, as there may, in fact, be a huge adoption potential for the cryptocurrency yet. Meanwhile, it is of global interest in the crypto ecosystem to consider how the eventual launch of the Libra coin may impact the overall community. As of the yet, there was no plausible change in the crypto market upon the news of the release of the much anticipated Libra whitepaper.