Alternatives

LibraCoin

June 23, 2019
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Hai everyone, how’s it all going?

Some interesting developments happened last week in the world of Cryptos which you may or may not have noticed.

Facebook came out and released a white paper (an info pack) about a new Cryptocurrency it’s originating called Libra and Calibra, the Blockchain platform supporting the back-office function.

It’s just another example of how the Blockchain is coming to the mainstream.

Image result for libra period
Wait…Libra…How awkward…

Wait… Cryp what? Block…chain?

Blockchain is the system in which a record of each financial transaction made in Libra (or any other cryptocurrency such as Bitcoin) is maintained across computers that are linked in a peer to peer network, i.e. blocks on an ever-lasting chain.

Each computer or “block” verifies the transactions of the “blocks” before it and so on.

For those of you who aren’t familiar with Cryptocurrency, have a read of some of my earlier posts (here, here and here).

Cryptocurrency’s intention is to make it as easy to send money or transact international business, as it is to send a photo.

But aren’t there other Cryptocurrencies out there?

True, true, but the difference is that Libra/Calibra will be backed by stable government backed money e.g. USD or JPY, and will be run, not by Facebook, but by a non-profit association supported by other existing payment platforms such as Visa, PayPal, eBay and Uber.

Once the coin is operational (estimated next year), Facebook’s users will be able to use this coin to pay for anything from a cup of coffee to sending monies internationally.

The implications for this are huge.

Why?

Because of the potential market up for grabs.

Facebook has 2.3 BILLION active users, with it’s subsidiaries Whatsapp – 1.5 BILLION and Instagram, 1 BILLION.

This makes Facebook having the highest level of personal touch points with individuals globally.

This is the opposite trend to my net wealth…

Oh OK.

Now imagine the colossal power and influence of one company with this number of individual users is able to develop a global currency and payments system that is transportable, secure, and most importantly, stable.

It would be the most disruptive and financially powerful business on the planet.

The vision of this new dawn in commerce, is not necessarily focused on success and growth in the US domestic market, with its mature economy, stable currency and government as well as trusted financial institutions.

No, the power of Libra is that if you are a Facebook user in Venezuela, or Syria, or the Republic of Congo – you may well trust Facebook a lot more that your local bank and transact as thus.

The ultimate goal for Libra is that it becomes the default currency in global trade, where now we have our local currency measured against the US dollar e.g. USD/EURO or USD/AUD, we might have it measured against Libra… Lib/EURO or Lib/AUD.

Hmmm, sounds fishy.

Well, for this technology to develop further, we are all going to have to trust Facebook as it will be securing Libra tokens onto a digital wallet (Calibra).

This would naturally bring up security and privacy issues – both of which Facebook has run afoul of in the past.

Image result for evil facebook
“We hold the world ransom for… ONE MILLION DOLLARS…”

Also, there’s no free lunches in this world – so of course, Facebook will be paid, in the form of commission earned on all transactions it processes.

And later on – there’s nothing to stop Facebook from expanding Calibra into other financial services such as lending or investing, further diversifying it’s revenue stream.

So what next?

It’s very much a watch this space kinda scenario.

After all, the jury is still out as to which Cryptocurrency will emerge triumphant (or if at all).

The US government has also issued a statement asking Facebook to pause this project.

Although I tell you – with such a well-known name such as Facebook jumping into this space, it does bring an element of credibility to Cryptocurrencies.

Which is part of why Bitcoin and other Crypto’s have seen their values surge this week.

And y’know what – I wouldn’t be surprised to see a few other well-known brands having a sniff in Cryptos in the near future.

What do you think? Did you enjoy this post? Please help me out if you enjoyed this and put your email in and click on the little “subscribe” button at the top right. This way, you’ll never miss my words of awesomeness! So do the right thing, be a subscriber and get it straight to your inbox fresh out of the oven!

P.S. Incidentally I “invested” in a Cryptocurrency during the last boom of Dec ’17 which also claims to be the next “unique payments platform”…it went from a peak of $30/coin to sitting at just under 40c… OUCH!

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