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Facebook’s Calibra Could Boost Bitcoin

Michael K. Spencer
Jun 18 · 9 min read

Facebook announced today June 18th, 2019 that their new financial services offering is called Calibra.

The newly formed subsidiary will build Facebook’s digital wallet, and it might represent the most innovative thing Facebook has ever done. This is because it could enable how its centralized encrypted chat will be monetized and how a widely adopted stablecoin could make Facebook a valid financial services hub.

This most likely will include how global citizens can invest in other cryptocurrencies. I’ve always believed Facebook planned to acquire Coinbase in the early 2020s.

What is Calibra?

Crypto bulls and industry analysts seem to have consensus that Facebook’s Calibra initiative will be good for cryptocurrency markets, Bitcoin’s price and the emergence of a token economy.

Facebook’s reported move into a blockchain-based FinServ product could most likely amount to the biggest catalyst for digital assets in their decade-long history, multiple crypto investors say.

Calibra, just to be clear, is the name of the digital wallet subsidiary that will allow and let people spend and save the currency. Calibra’s software and wallet is on top of the Libra blockchain.

Facebook’s 2.5 Billion users Can be Banked

This isn’t Bitcoin, a digital gold, more or less, that many of the world’s billionaires have bought up in the hopes it will surge. With regards to the Libra blockchain Network,Facebook, remember, have more than 2.5 billion users. Facebook and its partners and the Libra Consortium could be a significant endorsement of blockchain interactions (cryptocurrency) and a notable addition to Facebook’s evolving app ecosystem.

The Libra Network will also likely lead to a bunch of M&A in the space where Facebook could acquire talent and scalability technology to tackle even a public blockchain on top of the new stablecoin.

As many have pointed out, Calibra resembles a fairly standard payments company — but its tight integration with Facebook’s enormous user base could give it a significant advantage over any rivals. Its ecosystem of B2B partners also bodes well for merchant, retail and impressive E-commerce integration.

The Libra Network is Harnessing Crypto Hype

Libra has a multi-pronged play here and is a first-mover in how the token economy could work. The social media giant is launching the digital asset to be used as a peer-to-peer payment within messenger apps, among other things. Analysts say that could legitimize the space (and Bitcoin), make it easier to buy other crypto assets like bitcoin, and motivate big financial institutions to get out of “wait and see” mode.

With Libra and Calibra, Facebook is essentially harnessing Bitcoin hype for profit with a more utilitarian stablecoin. Facebook is cloning crypto hype and manifesting a product that can connect the new cryptocurrency world with the legacy financial system with a valid digital currency.

Valid because it’s an international play with enormous potential in the developing world. Calibra could protect countries from dangerous hyper-inflation scenarios, just what a stablecoin was said to be useful for.

Calibra could harness digital currency into the mainstream population. Facebook’s Libra could essentially clone crypto, and even become the dominant hub where we invest in tokens in the future.

The Libra Network is an extremely savvy play on multiple levels to monetize cryptocurrencies and allow for yet another peer to peer global payments network.

Bitcoin Should get a Boost By Libra & Calibra

Already Bitcoin is $9,100 on the news, the highest it’s been for a year, with the announcement of Calibra and the Libra Network.

Thanks to its proximity to the technical development of Libra and its ability to leverage WhatsApp, Messenger, and Instagram, Calibra could very well become Facebook’s next big thing.

Facebook is banking on the future of Chat scaling with the future of cryptocurrency and the token economy. That’s not a bad gamble to make. The problem is of course Facebook is doing it more like a bank and in a centralized manner than anything specific to Bitcoin’s most important aspect, decentralization.

Users Can Sign Up to Calibra Now

Although the financial service isn’t launching yet, the company is allowing users to sign up to be notified about early access. Facebook won’t fully control Libra, but instead get just a single vote in its governance like other founding members of the Libra Association, a consortium of payments and retail partners. Libra and Calibra will launch in 2020.

Analysts are optimistic in how this impacts the price of Bitcoin. Facebook’s Libra Network could give credibility to the token economy, in terms of both digital assets and cryptocurrencies in their more rogue-like fashion.

Libra is a Significant Catalyst for Bitcoin’s Price in 2020

Facebook’s efforts in the space has the potential to be one of (if not the most) significant external catalysts for Bitcoin and crypto adoption in the technology’s history. Crypto bulls are oddly bullish about the centralized BigTech version of the token economy launch.

Calibra’s immediate goal is to develop and launch its own digital cryptocurrency wallet and to integrate that wallet into other Facebook products. Facebook is a mature B2B hub with incredible advertising partners already. So the integration with services such as Uber, Lyft, eBay, and PayPal and many others like that is a given.

Facebook as a Digital Asset and Token Hub?

Facebook’s entrance to the market would be an easier entry point for the average person to buy cryptocurrencies and invest in the future of the token economy itself. This is why an acquisition of Coinbase makes so much sense for how Facebook matures its Libra Network platform.

Facebook doesn’t just want the payments sector, but how investment, gaming and many interactions could work. Facebook, as a digital asset hub, could be very lucrative and an interesting monetization model after being primarily an advertising giant up until now.

To register for more information about when Libra will be available, anyone can visit Facebook’s website for Calibra. Facebook also assures you that your data will remain private.

Facebook’s Digital Currency will be a Security

With a subsidiary and an independent consortium, Facebook can say it does not solely control the currency or the network by itself. It also gets the benefit of having twice the representation as other companies, at least for now (Verge). In appearing to be a highly collaborative and open platform, the Libra Network can facilitate mainstream adoption, hype and a wide array of payment and merchant partners.

Calibra is how Facebook intends to make money off Libra, a digital currency it says it does not want to control, despite having created it. More generally, it’s a massive play for Facebook to get into financial services in a way that no other technology company may be able to compete with. While it could boost Bitcoin in the short term, I actually think it could potentially compete with Bitcoin and eventually make it obsolete.

From what we know of Calibra, the digital wallet for Facebook’s new cryptocurrency will live in the company’s Messenger and WhatsApp apps in addition to being a stand alone app. Calibra is like one of the main products within what the Libra Network can become.

Facebook’s Libra Association Could Become Powerful

Libra’s formal announcement coincided with the release of an associated website and whitepaper. The Libra Association sounds pretty benign for now. The association will promote the open sourced Libra blockchain and developer platform with its own Move programming language, plus sign up businesses to accept Libra for payment and even give customers discounts or rewards.

That Facebook shares are up and Bitcoin’s price is up is not entirely unexpected. There is a lot of hype around cryptocurrencies with young people and the expectation that older people will transfer to a product like Calibra and Facebook’s lucrative partnerships in the Libra Consortium. America doesn’t easily differentiate differences like centralization and decentralization.

Libra Could Make Other Chat-Crypto Combos Obsolete

Calibra, as a competitor to Telegram, Line, Kik and so many others, immediately will dominate how it builds a digital wallet for people to store and exchange the currency using Facebook apps. This is because Facebook’s consumer reach globally is just so much more monopolistic and ubiquitous. Calibra should make products like EOS’s voice app an afterthought.

Facebook CEO Mark Zuckerberg has promised that Calibra will not put peoples’ money or privacy at risk and that transaction data would not be shared with Facebook.

We have to remember that Facebook’s blockchain project isn’t just a crypto offering. It’s what could launch a new approach to digital assets and the token economy. Industry analysts believe it could impact how Facebook does 1) Payments, 2) Commerce, and 3) Applications & Gaming, at the very least.

Calibra is still in its early stages and even a 2020 launch will likely be gradual. When the currency launches, users will need government-issued identification to sign up. Calibra will enable Facebook to become a bank for millions of unbanked global citizens in developing countries. The Libra Consortium could become very powerful very quickly in how the future of payments will work in the 2020s.

Facebook’s Libra Consortium

Facebook hopes to have 100 members in its association by the time the service launches. These are the founding members of the Libra Consortium (they call it an Association). Each of these hubs pays $10 million for the privilege. Regulation of how this all works will be very interesting to watch. The CFTC, SEC and FinCEN are likely to be implicated in the regulatory approval process.

The tokens are likely to be considered securities, which would fall under the jurisdiction of the SEC. Facebook’s Libra network will therefore be held to the highest standards possible. Facebook as a payments and FinServe company isn’t exactly a threat to crypto and its stablecoin certainly cannot be considered a cryptocurrency in any legitimate sense.

Facebook as a FinServe Partner

Facebook believes blockchain as its FinServe product will be good for the world. Facebook’s goal with Libra, at first, appears to be to provide people around the world with simple, affordable and secure access to financial services. The company notes in its announcement that half of adults in the world don’t have an active bank account, citing data from The World Bank.

Facebook Libra Network, according to some analysts, could over time actually hurt the currencies of smaller nations. Its stablecoin could become more powerful and literally disrupt some actual fiat currencies with how the world transitions to blockchain payments and blockchain based digital currencies instead of traditional fiat.

Facebook Using the Android Playbook

Facebook’s Libra is the “android playbook” and analysts are critical of the lack of transparency with how Calibra is being presented, when Facebook creates a subsidiary, and creates something that calls itself a cryptocurrency when it really isn’t.

Facebook has a trust problem with consumers, and here it’s going on offense, masquerading as being an advocate of decentralization, which of course is preposterous. Facebook doesn’t appear to perceive itself honestly, and for some business analysts this reflects an immature leadership and internal culture.

Libra is the technology that underpins the network. But when it launches, Calibra will likely be how most people interact with the currency until competing wallets arise.

Digital Assets Will Become more Convenient

For consumers this will be something you cannot live without soon enough. Facebook as a bank will have convenience at its core. Think about it, this Bank of Facebook’s — will essentially be an arm of the social platform that hopes to do for loans, credit, money transfers and commerce what its suite of apps has done for online communication.

This will include earning interest and various loyalty incentives that will play into our consumer mentality. This will include investment in other tokens and how we invest and secure digital assets. The Libra Network then could become something bigger than it first appears, as presented as a simple FinServ product.

With billions of users potentially interacting with Calibra, it will instantaneously have many hundreds of times the user base of the world’s most popular existing wallets from Coinbase and others.

How to Harness the Unbanked and Disrupt Fiat while Protecting It

Still, for the talent and security aspects, Facebook will be tempted to acquire Coinbase and integrate it with its services. Facebook will continue to eat up talent in the space and keep building features to become the dominant B2B and B2C hub in the space.

There are 1.7 billion people around the world that are unbanked, and the same number are underserved by financial services. The Libra Consortium could be making big decisions about how the future of money and digital assets occurs in the 2020s and 2030s.

Ironically, the fate of Bitcoin and cryptocurrencies could be in Facebook’s hands.

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Michael K. Spencer

Written by

Blockchain Mark Consultant, tech Futurist, prolific writer. LinkedIn: michaelkspencer

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Discovering the optimal lifestyle of the future.