Facebook Coin is not a Cryptocurrency
Contrasting Mark Zuckerberg’s Libra Coin with a real cryptocurrency like Skycoin
Amid much fanfare, Facebook this week revealed the details of its new digital currency.
The coin, officially called Libra, has also been acerbically dubbed GlobalCoin, CIA Coin, Illuminati Coin and ZuckBux by members of the cryptocurrency community. That’s because, despite Mark Zuckerberg’s claims, Libra is not a real cryptocurrency.
Libra fulfills none of the characteristics traditionally expected from a cryptocurrency. It’s not private. You don’t have control over your own coins. It’s not a non-inflationary store of value. It’s not censorship resistant. And it’s not even built upon blockchain technology.
So let’s compare Libra to a real cryptocurrency like Skycoin.
Coin Supply
Skycoin: Supply is capped at 100 million coins. No new coins can ever be created. This means Skycoin is non-inflationary (as any cryptocurrency should be, in order to remain a robust store of value). Skycoin value will tend to increase over time as demand exceeds supply, rather than the value being eroded through constant creation of new coins.
Libra: Supply is infinite. The value of Libra is pegged to a basket of fiat currencies, so the supply must also inflate along with those fiat currencies. New coins can be created at any time. From a store-of-value perspective, this makes Libra no better than traditional fiat. Just like fiat currencies, Libra will devalue over time as new coins are created. And despite Facebook’s claim that Libra will be ‘stable’, the value of its currency basket will actually fluctuate relative to the individual currencies used in each country.
Privacy and Anonymity
Skycoin: Skycoin can be purchased anonymously from Skycoin.net, or purchased/traded directly from within the Skycoin wallet. KYC (Know Your Customer) is not required. Nobody ever needs to know you own any Skycoin. Transactions are also private and anonymous via the CoinJoin protocol, and your IP address is not revealed while transacting over the Skywire network.
Libra: You won’t be able to buy or transact with Libra without giving Facebook your full details, meaning they’ll be able to track your financial activity and add this to the long list of personal data they already sell to advertisers. Facebook has also confirmed that they WILL provide your Libra transaction details to government agencies.
Security
Skycoin: You can store your coins on an exchange, a Skycoin mobile wallet, a Skycoin desktop wallet, a Skycoin hardware wallet, a Ledger hardware wallet, or a paper wallet. “Not your keys, not your coins” is an often-heard warning among the crypto community. With Skycoin, you and only you are responsible for safeguarding your private key. As long as you keep it safe, nobody else can ever move your coins. Nobody even needs to know you own any Skycoin.
Libra: You won’t be in possession of your private keys. Your funds are held by Facebook and may be confiscated at any time if Facebook decides you’ve breached its terms and conditions. The platform is full of fake and malicious accounts that may attempt to steal your funds. Facebook has a history of not taking appropriate measures to protect user data. The company has been sued for violating advertising regulations, and has been fined for deceiving consumers and failing to keep data private. Given Facebook’s history, it would be unwise to trust the organization to secure your funds.
Censorship Resistance
Skycoin: A primary goal of Skycoin is to bring an end to the scourge of online censorship. Skywire is a global meshnet that bypasses centralized ISPs, while CX and CXO will be used to build uncensorable versions of Facebook, Twitter and other social networks. Anyone can build a Skywire node for as little as $40, and it’s free to build decentralized games and apps using CX. The Skycoin ecosystem is owned by all of us — the everyday people who use it. No organization or government can censor or control the Skycoin currency, the Skywire network, or Skycoin CX applications.
Libra: A one-time-cost of $10 million is incurred to run a Libra node, plus a recurring cost $250,000 dollars per year. This means running a Libra node is out of reach for normal citizens, and ensures that Facebook and its corporate partners have full control over the network. Facebook has a history of censoring content, encouraging certain views over others, and promoting the platform’s own political or religious agendas. If you use the platform in a manner that Facebook doesn’t approve of, then you can expect your Libra funds to be confiscated or frozen. Libra will also be blocked/censored in USA sanctioned/embargoed countries like Cuba and Venezuela.
Blockchain Immutability
Skycoin: As with all true cryptocurrencies, Skycoin is built upon an immutable ledger distributed across thousands of nodes. The ledger is a chain of data blocks. Each block includes a hash derived cryptographically from its contents. Each new block appended to the chain references the hash of the previous block. This makes the ledger immutable, because it’s impossible to change the contents of a block without also changing the hash, thus causing the block to be rejected because subsequent blocks no longer refer to it.
Libra: Despite referring repeatedly to ‘The Libra Blockchain’, the Libra white paper concedes that Libra is not a blockchain, but is instead a simple private database. There is no immutable chain of blocks secured by cryptographically derived hashes. There is simply a single data structure that could easily be modified by Facebook. Transactions could be reversed, and coins could be created, deleted or moved at will by the database owner.
“Unlike previous blockchains, which view the blockchain as a collection of blocks of transactions, the Libra Blockchain is a single data structure that records the history of transactions and states over time” — Libra White Paper
Conclusion
Libra is not a cryptocurrency. It’s simply a digital currency, controlled by Facebook and its corporate partners. As an investment, it’s essentially worthless, because its value will erode over time alongside the basket of fiat currencies that it tracks.
Libra is nothing more than an insidious ploy by Facebook to boost revenue by spreading its tentacles further into your private life. Facebook will earn interest on the money you use to buy Libra coins, and it will also charge you fees to transact with Libra coins. Your financial data will be captured by Facebook and handed to advertisers and government agencies. Libra is the antithesis of a cryptocurrency.
Skycoin is everything that Libra is not. Skycoin is a fast, free, private, anonymous, secure, censorship-resistant blockchain-based cryptocurrency.
But the Skycoin currency is just one part of the Skycoin platform. Other components of the ecosystem include:
- Hardware (Skyminers, hardware wallets, antennas, custom PCBs)
- The Skywire global mesh network
- The Skycoin currency (fast, free, private transactions)
- The Coin Hours parallel currency
- The CX programming language
- The Fiber blockchain platform
- Numerous ICOs that have launched on Fiber
- Various games and apps built on CX/CXO/Fiber
To learn more about the world’s most comprehensive blockchain ecosystem, simply join one of these Skycoin telegram groups today.
Skycoin: https://t.me/Skycoin
Skywire: https://t.me/Skywire
Sky Fiber: https://t.me/Skyledger
CX General: https://t.me/Skycoin_CX
CX Labs: https://t.me/CXLabs
CX Game Dev: https://t.me/Skycoin_Game_Dev
Skycoin Rewards: https://t.me/SkycoinRewards
Price Discussion: https://t.me/SkycoinTrading
