The Arrogance and Genius of Libra Coin

Why Facebook’s plans for a cryptocurrency are already dead in the water

Scott Galloway
Jun 25 · 6 min read

Today I’m announcing a new cryptocurrency, the ProfG Coin. It will be available to users on the most powerful, secure, closed network known to the modern economy … AOL. (2.1 million people still use AOL for dial-up.) While other cryptos claim to serve the unbanked, ProfG will serve the unloved. I will surround users with white light and assure them that early adoption will make them feel less anxious and depressed.

If you’re not on AOL, no worries. We’ll be issuing a tangible fiat currency — Cialis pills. There will be 10mg and 20mg bills/tablets pegged to the Euro, a stable currency that looks cooler than the dollar. My launch partners are Chipotle, anyone who sells vitaminwater, Hulu (couldn’t reach a deal with Netflix — bitches), Discover Card, MedMen, and Crocs.

Libra. Is. Genius.

Facebook just announced plans for a new cryptocurrency. The key to Facebook’s economic success is a cocktail of vision, agile execution, sociopathy, and a market that had stuck its chin so far out it slipped a disk — the media industry.

The ad business saw creatives who dyed their hair in their forties and wore cool glasses as the messiahs of the last half of the twentieth century. The ad industry brought brand to washing machine and minivan manufacturers. Brand was a new kind of pixie dust that offered an exceptional lifestyle to mediocre business people. Yes, believers in the advertising industrial complex would be blessed with sacrosanct margins despite products void of soul or differentiation.

The flock kept putting coins on the collection plate even as ad rates escalated faster than inflation despite the product getting distinctly worse and viewership decreasing each year. Cue Facebook and Google with their fists of stone. Cannes is Rosé-doggle (Kara Swisher’s term), yes. But more than anything, it’s Don Draper’s last meal with the guy/gal who’s killing him, slowly. The executioners here are on the beach (Facebook, Google), and the convicted are in various Airbnb cells littering the hillside of the Croissette.

At Cannes Lions, a reporter from CNN interviewed her executioner, Sheryl Sandberg. Sheryl lamented that being around repeated privacy scandals had “been hard” for her. Really, Sheryl? Are you all right? Gross negligence retooled as executive stress makes for great Cannes content.

Facebook and Google may be negligent and sociopathic, but the advertising industrial complex is something worse: naive. When pensions are reduced or the retirement age moved from 55 to 58, workers in France and Greece put on yellow vests and block highways. When 59% of all spend on the next medium of communication goes to just two players, ad men (and women) demand a wristband to their executioner’s beach party. That’ll show ’em.

Brilliant

The Libra coin is brilliant. Other than education and healthcare, the industry most ripe for disruption is financial services. It’s figured out a way to avoid 1.7 billion people — a quarter of the planet — whom we refer to as “unbanked.” Yet two-thirds of them own a mobile phone that could help them access financial services. Within financial services, the remittance industry (wires, sending money home) is a $500 billion industry where the unbanked (the poor) are molested with 7% fees.

A stablecoin that facilitates inexpensive transfers of funds across borders could be the largest tax cut for the poor since vaccinations. In addition, hundreds of millions of banked people are vulnerable to poor governance and unstable currencies that result in vaporization of their savings (Argentina) or eating trash to survive (Venezuela).

Futile Genius

Facebook has started from the right place: an assumption that nobody trusts them. The social network has created a “council” of white guys in Geneva, as Switzerland is the gangster brand of finance and neutrality. Again, so smart. Facebook is in a unique position to facilitate these transactions with a user base of 2.4 billion people on a soon-to-be encrypted network. In many countries, Facebook is the internet.

In addition, Libra attempts to address the volatility and illicit feel of crypto by pegging the value to a basket of currencies and involving traditional players like Visa and Mastercard, who will maintain a ledger of transactions. Also, as we’re in Cannes, the branding is elegant. The libra was a Roman measurement of weight whose “L” inspired the symbol for the GBP. The internal Facebook group tasked with the effort is called Calibra. So good.

However, similar to the impressive Facebook Portal, it really doesn’t matter how genius the product is, as it’s over before it’s begun. Nobody was going to place a smart camera in their home from a guy who puts tape over his computer camera. And no elected official will let an organization with the culture of Uber, the negligence of Facebook, and the centralization of Visa replace their central bank. This is over before it started.

Note: There is $100 billion in shareholder value and genius to be unleashed if Facebook’s board grows a pair and does the right thing — fires Sheryl Sandberg and removes Zuck from the CEO role. Never has an organization needed to turn the page so badly.

Facebook’s arrogance has made them blind to the key component of every currency — trust. The good and bad news is, Libra will likely inspire another stablecoin from an entity of similar scale (few of them) but holding more trust. Just as Facebook has outsourced their product development to Snap, and now WeChat, several other firms will likely draft off the futile genius of Libra. Look for Amazon, Walmart (do you hear me, Doug?), Apple, or a European bank to launch a coin. In a man-bites-dog scenario, we’re about to see Facebook have its pocket picked.

The dangers here are clear and present. The three pillars of a takeover of society are media, money, and military. Facebook has taken over the media, where 45% of Americans now get their news from the social network. Governments won’t let Facebook use its superpower — negligence — to disrupt their economy. Enabling genocide in Myanmar is one thing, but messing with our ability to buy Chick-fil-A and Land Rovers is another level.

Fear-Mongering

Facebook and Google have been fear-mongering about the “unintended consequences” of regulation. This should inspire a collective gag reflex, as the social network and the search firm are the land of unintended consequences. There are a myriad of visible dangers. But just as we didn’t see coming the erosion in women’s reproductive rights at the hands of judges appointed by a president who may have been elected illegitimately by bad actors who weaponized a social platform, it’s difficult to even imagine the sh*t that could go down with Libra. But let’s try …

What if legislatures in Georgia and Alabama decide that the best way to stop the “murder of the unborn” is to leverage AI and hacked user data to turn off Facebook (i.e., money) for any woman who’s been to an abortion clinic? Or is Kathy Griffin, after violating Facebook’s policy, immediately late on her payments and sequestered from key services, as she no longer has access to the default currency for posting a pic offensive to the president? If you want to better understand how shutting off payment platforms can be the first step to persecuting a cohort, check out the The Handmaid’s Tale — playing now on ProfG Coin launch partner Hulu.

The immunities are beginning to kick in against big tech, and within 24 hours people ranging from House Banking Committee Chair Maxine Waters to Senator Sherrod Brown to the Governor of the Bank of France said, “en aucune façon” (no way).

Michael Jackson

If you let Michael Jackson babysit your kids, let’s be honest, anything that goes wrong is your fault. A guy hanging with monkeys and having sleepovers with boys from sycophantic families is a pedophile. That’s bad. What’s worse is, we knew it. Didn’t we? Even if the King of Pop had been chemically castrated and showed up to your house with a state-sponsored supervisor in a straight jacket, don’t let Johnny near him.

My go-to philosophers are Naval, Alain de Botton, and Fred Rogers. Mr. Rogers said, “Success is not fearing the truth.” I’m pretty sure Michael needed to be anesthetized with Propofol each night to sleep as, while he had reached the pinnacle of professional success, he had met the depths of species failure: violence against children. He died alone, bald, and 90 pounds. The truth about him had begun to surface.

Facebook’s Libra is genius. It could be of huge benefit to billions, and Facebook is uniquely poised to deliver against this vision. However, it won’t happen, as the firm is 90 pounds and bald.

Life is so rich,
Scott

Scott Galloway

Written by

Prof Marketing @NYUStern · Founder @L2_digital @redenvelope @prophetBrand · Contributor @bloombergtv · Cohost Pivot podcast · Weekly musings profgalloway.com

No Mercy / No Malice
No Mercy / No Malice
No Mercy / No Malice

About this COLUMN

No Mercy / No Malice

Each week, bestselling author and business professor Scott Galloway shares his take on success and relationships in a digital economy. Subscribe to No Mercy / No Malice to get weekly musings in your inbox: profgalloway.com

Each week, bestselling author and business professor Scott Galloway shares his take on success and relationships in a digital economy. Subscribe to No Mercy / No Malice to get weekly musings in your inbox: profgalloway.com

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