FinTech News
Facebook Officially Unveils Libra Cryptocurrency Plans
After months of speculation, reports, and some incorrect guesses to what its name would be, yesterday Facebook finally announced plans for its cryptocurrency – Libra. As expected the project includes partnerships with multiple brands and companies that will accept the token. Meanwhile Facebook will launch a wallet called Calibra for users to hold the currency, integrating it into WhatsApp and Messenger.
Despite Libra frequently being cited as Facebook’s cryptocurrency, their white paper explains that the blockchain currency will be overseen by the Libra Association — an independent, not-for-profit organization to be headquartered in Geneva, Switzerland. That arrangement addresses one issue critics had when news of Facebook’s currency plan leaked, with many pointing out the massive power the social network already held. Furthermore Facebook states, “Aside from limited cases, Calibra will not share account information or financial data with Facebook or any third party without customer consent. This means Calibra customers’ account information and financial data will not be used to improve ad targeting on the Facebook family of products.”
Of course that’s not the only concern Libra is addressing as it will be backed by fiat currencies to hopefully help alleviate the volatility that cryptocurrencies famously endure. That’s important as Libra investors want the token to actually be spent and not just stockpiled for investment purposes. In fact Libra’s goal is to allow users to pay for goods/services as well as send funds to others quickly and without large fees. Among the brands that already plan on accepting Libra are rideshare services Lyft and Uber as well as sites like eBay. Currently the project has 27 partners, although that number is expected to rise to 100 or more by the time the token launches next year.
Another goal of Libra is to serve those users who are currently unbanked or underbanked. To that point Calibra’s VP of product David Marcus told CNBC, “We’ve seen internet change the game for everything that could be digitized, except for money. The numbers really speak for themselves. There’s 1.7 billion people around the world that are unbanked, the same number are underserved by financial services.” He continued, “Now, anyone with a cheap smartphone has access to all the info they want in the world for free with a basic data plan. Why doesn’t money work the same way?”
With all of the hype now surrounding Libra, it’s important to remember that the cryptocurrency won’t launch for several more months. In that time it will be interesting to see who else signs onto the project and if that changes the mixed reactions that have met the idea so far. So, while this is the first we’ve really heard about Libra, it certainly won’t be the last.
