Libra is a cryptocurrency designed to be sent instantly across the world but, unlike Bitcoin, it’s backed by hard currencies like the dollar and yen. Facebook could use Calibra to offer financial services like lending or investing, diversifying its revenue beyond advertising.
A team at Facebook created Libra, but Libra will be run by a Switzerland-based non-profit consortium called “The Libra Association.” Facebook will get one vote, like all the other members.
Calibra will serve as the crypto wallet that enables users to buy, store, and spend Libra coins. Facebook, like all other founding members of the consortium, will earn interest on all the transactions its processes.
The Libra Association plans to expand that list to 100 from the 27 current members, each of whom paid $10m to process Libra transactions.
Once the coin starts working, sometime in 2020 FB said, the social network’s 2.7B users will theoretically be able to use the coin to pay for anything from an Uber ride to a cup of coffee like apple wallet.
Facebook hopes it will be able to avoid past privacy concerns that have plagued its platform by ceding operational control to a non-profit.
Many bankers and businessman-turned-Presidential-hopeful Andrew Yang praised Libra’s potential.
The new Facebook-backed cryptocurrency Libra could be a big step for the hundreds of millions of unbanked around the world. It’s use of the blockchain makes a lot of sense. Could even curb corruption as a lot of int’l aid money intended for impoverished people never reaches them.
— Andrew Yang (@AndrewYang) June 18, 2019
Regulators, on the other hand, have already demanded that Facebook pump the brakes on the project.
Do you think FB is poised to steer this in the right direction? See for yourself. Take a look at their white paper below.