First things first! What does Libra mean in this context? Libra the upcoming “Global Currency” from Facebook, etymologically means a unit of weight, equivalent to 12 ounces (0.34 kg). It was the forerunner of the pound. But, is that what they mean here? Most definitely, not.
The wordplay here is with the syllable ‘Lib’ which means ‘Freedom’, a subtle indication of Facebook’s impending solution towards making a global currency that gives financial freedom to billions of people. By becoming a bank to them in the most minimalistic way possible, Libra is set to reach about 1.7 billion people(You can use the wallet, transfer funds in Messenger and Whatsapp, yes that easy!)
According to Libra’s Whitepaper, the currency’s mission is defined as follows, Libra’s mission is to enable a simple global currency and financial infrastructure that empowers billions of people.
Word on Privacy by the Man himself
Facebook CEO Mark Zuckerberg threw light on the philosophy behind the whole data-leak and privacy concerns hovering around the currency. This is one important aspect Facebook Inc. is taking care of right from the beginning. He said, “It’s decentralized — meaning it’s run by many different organizations instead of just one, making the system fairer overall. It’s available to anyone with an internet connection and has low fees and costs. And it’s secured by cryptography which helps keep your money safe. This is an important part of our vision for a privacy-focused social platform — where you can interact in all the ways you’d want privately, from messaging to secure payments.”
Note: However, it is important to know that the transaction will be protected by Pseudonyms and not through Anonymity. This is one aspect that Facebook needs to be worried about.
So, what kind of currency will Libra be?
Libra’s value is meant to stay stable, so it acts as a fair medium of exchange, as merchants can be confident they won’t be paid a Libra today that’s worth less tomorrow. It is to be a stable coin right to the core. Libra’s value is tied to a basket of bank deposits and short-term government securities for a slew of historically stable international currencies, including the dollar, pound, euro, Swiss franc, and yen.
Libra Association is still figuring out the exact start value for the Libra, but it’s meant to be somewhere close to the value of a dollar, euro or pound so it’s easy to conceptualize. That way, a gallon of milk in the U.S. might cost $3 or in future money equivalent to 3 Libra, similar but not exactly the same as with dollars.
Partners – The initial Libra Associates
Facebook has been looking out for partners to fill the 100 planned nodes on the Libra’s blockchain. As of now, there are 28 partners from different segments;
- Payment Network – Visa and Mastercard
- Fintech firms – PayPal, Coinbase, and Stripe
- Venture Capitals – Thrive and Andreessen Horowitz
- Non-Government Organizations – Kiva and Women’s World Banking
- Telecom – Vodafone
- Marketplaces – eBay, Lyft, Uber, and Spotify.
The ambitions of each partner are varied: the software companies augur economical global payments (especially focused on micropayments). The NGOs wish to offer newer ways to provide financial services to the people who don’t have basic banking facilities (they could later become customers of the other financial partners).
Blockchain partners envision Libra as a means to target other cryptocurrencies. Another new entrant is Calibra, Facebook’s subsidiary that is creating a wallet and other seamless processes for the Libra ecosystem.
There are no banks that have joined hands with the Social Media giant on this, however, the company says it’s open to partnering with banks.
Revenue – Libra’s all about the longer run!
Facebook is not going for the short game and is clearly aiming to stabilize its relevance in the longer run. This is evident from Facebook’s Vice President of Blockchain David Marcus’ verbatim, “If more commerce happens, then more small businesses will sell more on and off a platform, and they’ll want to buy more ads on the platform so it will be good for our ads business.”
So, Facebook has started its journey North with Libra; a stable coin combined with the power of Blockchain. If you are looking for coin development services for your Libra like the project then you needn’t look any further!