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18
jul
2019
Nicolas DIACONO
Technological Trends Senior Analyst
2 minutes
On June 18, Facebook unveiled its cryptocurrency project named Libra. A project carried by Facebook but also by a heavy army of 28 co-founders … This new cryptocurrency is ready to redraw the world of payments!

Facebook launches its cryptocurrency project Libra!

On June 18, Facebook unveiled its cryptocurrency project. It is named Libra and it is also carried by Paypal, Mastercard, Lyft, Uber, Spotify, eBay, Stripe, Vodafone or the French Iliad. A real consortium that gives much more credibility to this project and will seriously compete with existing cryptocurrencies like Bitcoin, Litecoin, Ripple, Ether, Dash, Bitcoin cash ...

On this occasion, Facebook has published a white paper on the Libra project whose objective is clearly presented :

“Libra’s mission is to foster the development of a single global currency and financial infrastructure serving billions of people.”

This currency is based on a blockchain technology programmed with the programming language move. Libra is therefore the currency of the Blockchain Libra technology supporting it. The goal is to process more than 1000 transactions per second, about half of what a payment player like VISA does.

“Unlike Bitcoin, not everyone can become a minor, you have to go through an” authorization “request, which makes some experts say that it’s more of a digital currency than a real cryptocurrency. . A currency that should however be more stable than Bitcoin by its more controlled model. However, the firepower of this consortium massively worries central banks. The financial stability council attached to the G20 has also met to discuss the subject Libra last June 28th and 29th. Importantly, this system would be significantly more energy efficient than Bitcoin” says Nicholas Weaver, a research scientist in computer science at the University of California.

Facebook, future competitor of banks and states?

The world of payment is clearly in the waiting phase as a result of this announcement. The presence of Mastercard, Paycal or Stripe brings a great legitimacy to this project and will clearly allow the very fast creation of a network of acceptance of this currency.

Consumers will be able to pay much more with Libra for purchases on in-store payment terminals than Bitcoin has ever been able to do. Traditional currencies could very quickly compete with Libra hence the concern of many central banks. For the governor of the Banque de France, François Villeroy de Galhau, this project raises many questions.

Also, for 2.3 billion Facebook users, this currency could become their new way of payment. It facilitates international purchases and puts an end to foreign exchange commissions. In one click, users can pay on Whatsapp, Instagram, Messenger or Facebook via the application Calibra and as well as to manage their account … no more tedious forms of payment to fill.

Facebook is positioning itself with Libra as a real competitor of banks for remittances abroad unless they join the projects to not be disintermediated.

Indeed, once the currency is installed, there will certainly be a galaxy of financial services that will be available on this open source model.

According to a study conducted by Yougov for the 20-minute newspaper, only 12% of respondents trust Libra currency and 67% do not know why they would use it. Among 18-24 year olds, it is not quite the same trend since 20% are ready to start to pay online or transfer money to relatives.

So, are you ready for Libra?

Nicolas DIACONO
Technological Trends Senior Analyst
As an expert in emerging technologies, Nicolas travels to innovation shows around the world to spot and analyse the new trends.
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