Facebook Libra Coin will Stimulate Mass Adoption of Crypto
Why and How Facebook’s Libra Coin will stimulate mass adoption.
The consensus among Bitcoin enthusiasts and cryptocurrency investors seems to be that Facebook’s Libra Coin will stimulate mass adoption.
As a Futurist, I’ve spoken about how it could usher in a token economy, where digital currencies and tokens exist side by side with traditional Financial services, legacy banks and fiat currencies.
As a mobile Advertising giant with an app-ecosystem with well over 2 Billion global users, Facebook is an ideal hub to create such an infrastructure that could impact the future of:
Crypto as a Digital Transformation Catalyst
- Crypto investing
- Digital banking
- E-commerce channels
- Chat & Communications
- Digital creator/Influencer monetization (freelance economy)
- Advertising incentives
Facebook’s Libra coin therefore is not just a digital currency play, but an entire monetization play around how blockchain can impact digital transformation as a whole. Making cryptocurrencies more mainstream could be an interesting side effect if Facebook’s Libra initiative is successful.
Mass Adoption of Crypto
The third party developer ecosystem of the Libra blockchain could become popular easily due to Facebook’s global reach and stellar user base. It could in theory put Ethereum, EOS, TRON and others in jeopardy, all the while monetizing WhatsApp, Messenger and Instagram better.
Facebook calling the Libra Coin a “cryptocurrency” is also a way to steal some Bitcoin fans, and legitimatize the crypto hype as an on-boarding tool.
A stablecoin overseen by the Libra Association is a security. It’s obviously not a decentralized cryptocurrency. However by duping the masses that it is a crypto, it fosters mass adoption and potentially another Bitcoin to the Moon movement. Another crypto singularity.
Financial institutions, like banks, are currently testing out blockchain networks with XRP/Ripple services and JPM Coin/Quorum, but they are too late. Libra and Bitcoin (with the Lightning Network) could rule the token economy in the 2020s.
Binance rightfully (June, 2019) points out that the gradual shift from a permissioned network to a permissionless environment should encourage stakeholders to start building now to capitalize on first-mover advantages on the Libra ecosystem.
One Blockchain Portal to Rule them All
Libra will create a blockchain infrastructure with a Libra coin to own the future of:
- Self-sovereign-identity (Libra coin is just a way to get you using Facebook’s walled garden again) on a blockchain infrastructure of your digital ID portal.
- Mobile development (dApps on Libra Blockchain too)
- Digital payments (not just a store or digital asset, but actual P2P and cross-border global transactions)
- Targeting the developing world, immigrants and vulnerable countries will mean they adopt aspects of the token economy and cryptocurrencies instead of fiat!
Today, the cryptocurrency world has a global market cap of $285.7B. Facebook’s Libra could mean this doubles by 2022. This is my personal estimate.
The consensus amoung crypto enthusiasts is that the Libra ecosystem looks to be uniquely positioned to broaden the reach and impact of the crypto world through increased accessibility and participation.
- Imagine an entity the combined size of Coinbase and Binance with much more money and high-level partners.
- Facebook's plan to centralize its chat into one system means Facebook’s Libra coin is actually the ultimate centralization play of a global digital currency (having nothing to do with decentralization). Very powerful people want such a global digital currency to manifest and will push this through.
- New on-ramping options: Libra’s blockchain will make several improvements in how accessible cryptos are to the world, to developers, to merchants, to investors, to everyone!
- Additional arbitrage opportunities: As Binance mentions in their report, with Libra being traded against major cryptocurrencies such as Bitcoin, this creates arbitrage opportunities that may only be closed by trading the quote pair (in this case, Bitcoin). This means Libra elevates Bitcoin, which elevates the entire cryptocurrency market.
The Stablecoin Hybrid Economy
- Libra’s Coin Legitimatizes the hybrid stablecoin economy. Functionally this means a hybrid digital currency/fiat system where true cryptocurrencies are at the other extreme of the spectrum with Libra Coin at the center. Obviously, existing stablecoin issuers will be forced to maintain similar levels of transparency and ease of on-ramping in order to provide a comparable option to crypto users in terms of convenience and product.
- Basically what the stablecoin hybrid economy does is stimulate mass digital assets and currency adoption. This is the same as saying cryptos will achieve mass adoption.
- Libra is likely the best opportunity in 2020 for Bitcoin to achieve new highs.
- Libra’s blockchain and the Libra Association will mean merchants, retailers, brands and B2B partners will finally have the master incentive to make the token economy front and center in how they offer convenience, digital currency options and payment ubiquity.
- Follow a Futurist, sign up to receive blog-rolls about breaking news in Business and Technology & related Op-Eds.