Facebook Libra, Threat Or Opportunity?
By Lamium on Altcoin Academy
“The nation of Facebook, if you will, is 2.7 billion people. Just their sheer reach and ability to coordinate as many parties as you saw from this announcement, is unrivaled, and I think this is the biggest development for the industry since the launch of Ethereum four years ago.”
- Ryan Selkis
The rumors about Facebook’s upcoming cryptocurrency, stablecoin, or token have been circling within the industry for years. Finally, during June of second-quarter 2019, Facebook officially confirmed the launch of Libra. The upcoming Libra will be an essential addition to a growing number of digital currency solutions, Libra will also escalate the mainstream adoption of bitcoin and other cryptocurrencies. We gathered some of the upsides and downsides related to the future launch.
Upsides
One of the most obvious advantages is that Libra will likely be integrated into some of the world’s most prominent consumer applications and payment service providers. Facebook and its founding members have massive distribution channels and user bases that span a multitude of users on both the supply and demand side of a transaction from merchants (PayPal, Visa, Mastercard, Stripe, eBay) and members of the gig economy (Uber, Lyft) to consumers. Libra will also make cryptocurrencies more widely known to the global mainstream customer. Facebook currently has a user base of close to 2,7 billion people, even if they create traction with just 1% of the current user base, the impact will be significant.
Downsides
Perhaps the most distinct disadvantage is the growing distrust expressed by users regarding Facebook’s handling of customer data. It is well understood Facebook shares user information in exchange for ad revenue, and as a result, data collected by the tech giant is far from private. The Cambridge Analytica hack in 2018 revealed the magnitude of information Facebook possesses and the lack of protection around this data.
Libra also seems to be in a collision course with several regulatory risks. During late Q2 2019 US Congress asked Facebook to stop the launch of Libra. Additionally, several countries, like Japan have expressed somewhat hostile views into the currency. These national-level institutions are seemingly afraid that Libra will potentially pose a threat to national currencies and jurisdictions.
What’s Next?
Announced for release in 2020, Libra will be an exclusive event for whole digital asset industry.
Libra’s Google search results peaked during mid-June along with mainstream media coverage. One interesting detail in peaking search results was the heavy interest in emerging markets countries within South America. Apparently Libra’s aligned value proposition as emerging markets currency is gaining some early-stage traction.
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