Hundreds of cryptocurrencies were launched after Satoshi Nakamoto published his famous Peer-to-Peer electronic cash system whitepaper that eventually resulted in the launch of Bitcoin. Today over one thousand cryptocurrencies are listed at coinmarketcap.com. In Jun this year, Facebook takes on the world of cryptocurrency with his coin called 'Libra'. Libra is expected to launch in the first half of 2020 and the whole world is taking it seriously.
What is Libra?
Libra is cryptocurrency built on top of blockchain (Libra blockchain). A peer to peer money transfer system that will allow its users to make payments with the currency via its own apps, as well as on messaging service WhatsApp.
Why is it called Libra?
According to The Guardian, "The name Libra comes from the basic Roman measurement of weight. The abbreviation lb for pound is derived from Libra, and the £ symbol originally comes from an ornate L in Libra."
Is Libra Global?
As per today's news Libra will be available to all of its 2.38 billion users across the world. Facebook users can use their real-world money to buy Libra digital coins.
Libra whitepaper was released on 18 Jun 2019. You can find the complete whitepaper here. We have extracted some key points from whitepaper:
Libra has its own secure, scalable, and reliable blockchain. As Libra is developed to have global audience, the software that implements the Libra Blockchain is open source.
Libra unlike most cryptocurrencies is not just a piece of code rather its fully backed by a reserve of real assets. A basket of bank deposits and short-term government securities will be held in the Libra Reserve for every Libra that is created, building trust in its intrinsic value.
To look after affairs of Libra an independent, not-for-profit membership organization is established with headquarters in Geneva, Switzerland. The role of association is to coordinate and provide a framework for governance for the network and reserve and lead social impact grant-making in support of financial inclusion. Libra association has 28 founding members that includes by industry Payments (Mastercard, PayPal, Visa), Technology and marketplaces (eBay, Facebook/Calibra, Uber Technologies, Inc.), Telecommunications (Vodafone Group), Blockchain ( Coinbase, Inc.) Venture Capital (Andreessen Horowitz, Breakthrough Initiatives, Ribbit Capital) and Nonprofit and multilateral organizations, and academic institutions (Creative Destruction Lab, Women’s World Banking).
Libra is StableCoin
According to investopedia, "Stablecoin refers to a new class of cryptocurrencies which offer price stability and/or are backed by reserve asset(s)." Some stablecoins include tether (USDT), trueUSD (TUSD) and gemini dollar (GUSD).
Libra aims to be stablecoin, as value of every Libra will be based on a basket of stable assets and due to this its price will remain stable. Investors can invest without any fear since being a stablecoin Libra will remain free of wild swings of crypto market.
Is Libra really a Cryptocurrency?
According to cryptocurrency community, anything that is centralized and under one single owner control cannot be classified as cryptocurrency.
Libra permissioned blockchain and formation of Libra Association a nonprofit organization to oversee Libra's launch and govern the currency are few of many concerns among cryptocurrency community for Libra.
Due to these factors Libra cannot be compared with Bitcoin, as Libra will be controlled by facebook while Bitcoin is controlled by its community.
Libra edge over Unregulated Cryptocurrencies
We live in world where 1.7 billion people are still out of the financial system with no access to a traditional bank, despite the fact that one billion have a mobile phone and nearly half a billion have internet access. Unregulated cryptocurrencies like BTC, Eth are fighting hard to be adopted as mainstream means of payment for almost a decade. Libra being a regulated cryptocurrency will find it easy to be adopted by different governments of the world.
Although U.S congress is also showing his serious concerns over Libra but hopes are that it will very soon get green signal from congress.
The crypto revolution is on its full swing and those who foresee the future are embracing this change with open arms. Libra is just an example of this and if you don't know about this financial revolution you are already too late.