Facebook’s Libra: envisioning financial empowerment but marred with controversies
The first seeds of Libra was planted in 2018 on the backdrop the the infamous Cambridge Analytica scam, where private data of over 50 million users got compromised. In June 2019, Facebook formally announced Libra by releasing its whitepaper to set forth its launch in 2020.
The main target market for Libra was South East Asia, particularly India, which have huge numbers of unbanked population. Libra envisioned its growth in the same way as the growth of number of smartphone users, internet penetration and social media reach in these regions. With an added advantage of 2.38 billion homogeneous user-base, they can leverage those users to adopt Libra and push into mainstream acceptance.
What actually is Facebook Libra ?
It is a global currency and financial infrastructure to empower people. Some of its features are as follows:
a. Built on a secure, scalable, and reliable blockchain.
b. It is a stablecoin which is backed by a reserve of assets.
c. governed by the independent Libra Association.
d. Smart contract coding is done through “Move” programming language.
e. Uses the LibraBFT consensus mechanism.
David Marcus clarifications
David Marcus, head of Calibra, a subsidiary of Facebook and the official wallet provider for the Libra cryptocurrency, became a frequent newsmaker by either attempting to quell concerns around the project or making assurances about its future. There were a series of discussions with the US lawmakers and the subsequent Bitcoin (BTC) price falls from what they call “Libra Effect”. According to Marcus, “the existing ‘money networks’ are closed and are not well interconnected”. He also said that Libra is an ambitious project different from traditional system. To name some are the Anti-Money Laundering and Know Your Customer procedures will be much tougher than elsewhere. He also assured that this time the data will not be shared to the third party unlike the previous instances.
Conclusion
The time when Libra hits the market, it will surely drop the Bitcoin and other cryptocurrency prices to a huge level, on the basis of the vast user base. But if Libra succeeds in its sole objective, then in no time it will enhance and empower the financial system of world, particularly the South East Asian countries.
