Discussing the launch of Libra, "A new global currency"

Libra.org is now live.

"Libra’s mission is to enable a simple global currency and financial infrastructure that empowers billions of people."

This project is receiving a lot of attention, and is being described as "Facebook's crypto currency." Per TechCrunch, that's not necessarily an accurate description, though they were a primary backer of the project:

Facebook won’t fully control Libra, but instead get just a single vote in its governance like other founding members of the Libra Association including Visa, Uber, and Andreessen Horowitz who’ve invested at least $10 million each into the project’s operations.

I enjoy the writing of Fred Wilson from USV. Here is his post on the USV's involvement.

The Libra code is on GitHub: https://github.com/libra/libra
And they've also open-sourced a related programming language called Move: https://developers.libra.org/docs/move-paper

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I think it's pretty easy to take a "Facebook is evil" and highly skeptical and pessimistic position. That position is totally justifiable given Facebook's track-record on privacy and a host of other issues. But I also think there's a reasonable case for optimism.

What do other people think?

Comments

[Sebastian Vargr]

Interesting, one of the main problems with crypto has been regulation, and company backing.

You can say a lot of distrustful words about these organizations, but monetary intentions move mountains.

Visa and Facebook are also great entry points into the mass consumer market, a market which so far crypto have had issues with.

I’m cautious like everyone is, but also curious where this can go.

[Clive Da]

thanks so much for posting this its inspired my to write fork your own bitcoin BUT can you please block the devto SEE ALSO links or do you really need a feature request ? devto ban

[Jordy Lee]

Agree 100% in that capitalism's toxicity has passed the point of no return. Though the OP of this comment is correct in stating that the premise of capitalism is it ostensibly "benefits" society when people are incentivised to act selfishly (this is the sentiment pushed by capitalism purists).

The problem with this narrow-minded view is it's treated like a fundamental law by economists even though it's very clearly flawed. Just look at climate change contributing to the massive bushfires in Australia or the huge inequality gap in 2020 (there were ~150 billionaires in the 1990s; today there are ~2500, but the quality of life for most people has not moved), to see how people acting selfishly really just destroy society in the long run.

On that note, I'm happy to take advantage of Facebook's other open-source contributions (e.g. React) but I would never contribute to or use Libra - purely for moralistic reasons.

[Theo]

I am certainly skeptical of this new platform and it will no doubt be successful as so far crypto currencys have been seen as a pretty hard to use and not for the general public.

While it is true they (Facebook) get as many votes as any other backers on the board this isnt strictly true as they have invested a great deal more in the company so have more influence over decisions. While you can argue this isnt true, and it certainly isnt on paper. Te fact is they have more inluence as the other backers dont want them pulling out of the project for instance.

[Bugsy Sailor]

Mostly, I'm surprised it's built in Wordpress. Which I have no problem, but considering the players I wouldn't have expected it.

[Cécile Lebleu]

Coming to from a 3rd world country, I’m still not buying. There is absolutely nothing in it for “us”, no possibilities beyond what we can already do. A lot better than relying on a foreign game coin (because it’s not much more than that) would be to actually pay taxes, as we already do, and develop these countries, as we are already doing, since the 1st/3rd world classification exists.
Say tomorrow everybody in X developing country moves to FaceBucks. What happens? The country is broke, there is no money for streets, safety, health systems, etc. Instead of helping the poor country, it’s destroying it, and giving all the profits and data to BigCo instead.
People in developing countries don’t need more opportunities via internet coins, they need their country to develop. And that’s only done through local commerce, startups, entrepreneurs, and fair international business (which a mostly American big corporation owned coin isn’t)

[Mik Seljamaa 🇪🇪]

So why the optimism? The suspense is killing me!

[Filip Defar]

I'm actually quite optimistic about the project. Worst case scenario, they will make huge steps in researching blockchain and help develop truly independent currencies and we can avoid Libra by using fiat currencies as we do today.

[rhymes]

I think worst case scenario Facebook and governments have access to even more private data :D

[Filip Defar]

If I understood the whitepaper correctly everyone will have access to the full ledger, so Facebook won't have any special treatment regarding this. However, wallets are based on pseudonyms and you can have multiple wallets (similar to Bitcoin) so it won't be easy to link a wallet to a human.

[rhymes]

Hoyos asserted that the project whitepapers contain various promises he described as "contradictory." For instance, one section indicated that Libra user accounts are "dissociated from their real-world identity." But in a separate document on Calibra, the digital wallet associated with Libra, Facebook stated that "Calibra will use Facebook data to comply with the law, secure customers' accounts, mitigate risk and prevent criminal activity" -- but not for ad targeting purposes.

from thestreet.com/investing/stocks/wit...

The limited cases where this data may be shared reflect our need to keep people safe, comply with the law and provide basic functionality to the people who use Calibra. Calibra will use Facebook data to comply with the law, secure customers’ accounts, mitigate risk and prevent criminal activity.

from newsroom.fb.com/news/2019/06/comin...

Which means that, at least for Calibra users (which would become the defacto standard wallet, since they have the majority of users), there seems to be a way for FB to associate transactions to identity and governments can request those.

I think it's too early to be optimistic or pessimistic, I just don't trust FB :-)

[Thomas H Jones II]

Overall, it seems the primary value for these things is international travel. If you're already a frequent international traveler, you've probably already got a travel-oriented credit card in your wallet. Such cards typically already take care of the problems Libra is targeted towards solving.

Given both Facebook's track record and that of other e-payment services' (like Venmo's) trackrecords on privacy, I'll probably just stick with using travel-oriented credit cards. Presumably, they'll remain at least as widely accepted as new-tech options and retain a information leak-radius I'm already comfortable with. Plus, with credit cards, I don't have to play the gameroom-token game.

[DrBearhands]

Adding to many good points people have already made against this development:

• National currencies and the organizations that control it are under scrutiny by government organizations that, in theory, protect the interests of the people. No such protection exists for cryptocurrency.
• National currency inflation is, in theory, regulated by government organizations explicitly to benefit the local economy. It benefits workers at the expense of the creditors and money-hoarders. This solution becomes impossible with a 'global' currency. We've recently seen an example with the Greek financial crisis, were Greece would have profited from a higher inflation of the Euro, but this would have harmed Germany (we did get some inflation in the end).
• A private 'blockchain' is no more than a stack. It only serves as a tech demo or to people into a false sense of security.
• A 'stablecoin' is just a trust (or fake, if it is self-backed, but that's not the case here). There is no benefit to consumers to using a 'stablecoin' over using a FIAT currency such as dollars or euros.

What's proposed here is a bank that doesn't have to follow any pesky regulations.

[Vuild]

Well diagnosed Dr.

What's the treatment?

😃