James Ball, a British journalist who won a Pulitzer Prize last year, called me a few weeks ago to talk about Facebook’s Libra project, and today he quotes me in his Wired article, entitled “Libra’s biggest problem? Facebook”.
My view on crypto coins is that this is an ideal moment for stablecoins, which are simpler, as opposed to cryptocurrencies, which are generally seen as difficult, speculative and with very unclear allocation mechanisms that favor the well-informed.
Libra can be seen as the privatization of money in search of the convenience derived from less friction; an attempt to circulate electronic money that other players have tried, both public and private. In addition to being an interesting currency basket, it has the universal reach of Facebook, which would facilitate a fairer form of allocation.
The problem is that nobody trusts Facebook company with anything as sensitive as financial information. If we are going to use electronic money, which already means a very important loss of privacy, the idea that a company with a history like Facebook’s knows everything about how we spend our money is, to say the least, scary.
Several countries have already said they are opposed to Libra, prompting the flight of several of the consortium’s original partners from the project, although Facebook says it’s determined to remain the driving force of the project. As such, everything indicates that Libra will remain in the dry dock for quite some time. Which is no bad thing. Experiments of this kind are best kept under control.
(En español, aquí)