Altcoins Talks - Cryptocurrency Forum
Cryptocurrency Ecosystem => Stable Coins Forum => Topic started by: rajput on October 18, 2021, 03:39:15 AM
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One year ago, Facebook announced its new cryptocurrency, called Libra. We gave them one year to decentralize it. One year later, we have an update — as well as some happy financial results, for those of you who invested.
That Escalated Slowly
The most surprising thing is how slowly the Libra project has moved forward. Facebook’s slogan, of course, is “move fast and break things,” but that doesn’t work when it comes to reshaping the global economy, where the project has been mired in scrutiny from regulators around the world.
First, I should be clear that it’s not a Facebook project: it’s technically owned by the Libra Association, a separate organization set up in Switzerland , which now includes 27 members: mostly tech companies like Uber and Spotify, plus VC firms like Andreessen Horowitz and Union Square Ventures.
But it started at Facebook.
That’s why regulators have raked Facebook over the coals. As I pointed out a year ago, Facebook has over 2.5 billion users — a third of the planet — and introducing a new digital currency would make Facebook a global economic superpower overnight. (Now, that’s thinking big.)
TL;DR: Regulators have put the brakes on the project, scaring off original Libra partners like PayPal, Mastercard, and Visa. In response to these concerns, Libra has posted a new version of its white paper to address some of these concerns — we’ll call this Libra 2.0.
Libra 2.0: How it Works
Imagine that you have a Libra “wallet” — like a bank account — that you set up through Facebook. You can “load it up” with your own national currency, then use it to buy products and services on Facebook — as well as many other partners, like Lyft or Shopify.
But you might choose to keep your Libra in the wallet. It’s easier to transfer to friends and family (like Venmo). It’s easier to transfer internationally (like sending an email). It hides all the complexity of exchange rates and transfer fees — it’s just one currency, Libra.
But you might keep your money in Libra for other reasons. Maybe you get a better savings rate than your bank can give you. Maybe it’s easier to take out loans. Maybe it’s just a better experience than your bank. (In fact, maybe the bank itself starts to look old-fashioned and out of touch.)
As it stands today, then, Libra 2.0 looks more like a digital payment system built on a blockchain platform. This makes it more like a competitor to PayPal, but built on blockchain (and as we all know, blockchain is better).
Over the last year, the Libra Association made a few important changes to the original whitepaper:
1) Stablecoins. In the new roadmap, Libra uses stablecoins tied to specific currencies (like a US dollar coin), in addition to the “basket” of currencies they used in their original proposal. Importantly, these stablecoins are backed by “real” assets: they will only mint a Libra USD if they have a dollar backing it up. Instead of a dollar sign, these will be written with the Libra logo and then the currency:
info. https://jhargrave.medium.com/investing-in-libra-how-to-buy-into-facebooks-digital-currency-in-2020-50d474059ff6
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All these plans are in the past. Zuckerberg took various measures to avoid the influence of regulators, but he never succeeded. He also failed to convince them that his Libra/Diem stablecoin would have nothing to do with Facebook. As a result, he had to sell his project to one of the banks. Perhaps the project will still be revived, but in a different capacity, and what was expected of it will no longer come true.
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Thank you for sharing about these strategies.
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Libra/Diem is already a dead project. After its sale by Zuckerberg, nothing more was heard about this stablecoin. This project's time is up. Libra/Diem was not released and is now unlikely to ever be released.