Altcoin News: Binance: FB Cryptocurrency Will Have a Significant Impact on the Financial Industry and the Economy

June 18, 2019, by Marko Vidrih on ALTCOIN MAGAZINE

Marko Vidrih
Jun 18 · 3 min read

The today’s announcement of the Facebook cryptocurrency project served as the basis for a whole series of discussions and opinions on the role of the tool in the world of digital currencies and in the global financial system as a whole.

Among others, the research department of the Binance exchange shared its observations and forecasts.

As analysts say, Libra is not a stablebcoin in the usual sense of the word, since its course is determined not by one fiat currency, but by four at once: the US dollar, the British pound, the Euro, and the Japanese yen.

The Libra blockchain is expected to use the BFT variation of the Proof-of-Stake consensus mechanism.

Below is a comparison of Libra with another acclaimed cryptocurrency initiative from the world of traditional business — JPM Coin of JP Morgan Bank.

Image credit: Binance Research

Binance Research draws attention to the fact that there are no financial institutions among the partners of Libra, for example, banks — only payment services. According to analysts, such companies are less willing to take risks and less interested in the transformation of the existing industry.

It is expected that users of Facebook, Whatsapp and Instagram will constantly use Libra along with other services provided by applications. At the same time, at present, Facebook cryptocurrency has no direct competitors comparable in scale.

In the medium term, Libra can have a positive impact on both Facebook and the cryptocurrency industry, analysts say. For a social network, this is, first of all, the development of mobile and payment solutions. For cryptocurrency — a new tool to enter the market, additional arbitrage opportunities, increased competition among issuers of stablecoins and the expansion of technology coverage.

In the long term, according to Binance Research, Libra is able to change the payment industry, increase the availability of financial services and even become the engine of rejection of the dollar as a universal unit of international payments.

At the same time, the development of payment solutions of existing cryptocurrencies, such as the Lightning Network Bitcoin, can be slow.

“Facebook’s initiative, with the Libra cryptocurrency at the center of the project, will have a significant impact on the financial industry and global economies from both a medium and long-term perspective. Backed by a basket of fiat currency-denominated assets in its initial release, Libra represents a first attempt at creating a world currency, on-chain or not, with everyday usage by billions of individuals and institutions across the globe,” analysts concluded.

Author: Marko Vidrih


ALTCOIN MAGAZINE

The best damn place to read and write about crypto and blockchain.

Marko Vidrih

Written by

I love writing, and that is why I do it. A passion for not only providing the information but for helping people understand.

ALTCOIN MAGAZINE

The best damn place to read and write about crypto and blockchain.