Facebook Libra Cryptocurrency, Launching 2020
Facebook is set to launch a new cryptocurrency called Libra and a digital wallet called Calibra in 2020.
As technology improves daily,more payment methods evolves on daily basis, currently cryptocurrencies such as bitcoins has become a success and is use by a lot of people worldwide.
As a result, many companies and organizations have attempted to introduce new cryptocurrencies of which most
Facebook is diving into cryptocurrency, Facebook is set to release a new blockchain-based currency called Libra that could challenge bitcoin.
Libra , when launched will be controlled by a nonprofit group in which Facebook will share responsibilities with other companies like Mastercard , PayPal ,Uber and eBay.
The currency, which is still undergoing testing phase, is expected to launch in 2020. Facebook says Libra will have very low fees and that people using its apps will make a number of payments simply by sending a text message.
Facebook also is testing the new digital currency as a service for all 1.7 billion adults worldwide, as World Bank estimated as people who don’t have access to a bank account, which could particularly benefit women and people in developing countries.
“All over the world, people with less money pay more for financial services,” the Libra site states, citing burdens such as steep usage fees and high-interest payday loans.
The World Bank identified financial inclusion as a key driver of development. After mobile money services expanded in Kenya, according to the report, “it enabled women-headed households to increase their savings by more than a fifth; allowed 185,000 women to leave farming and develop business or retail activities; and helped reduce extreme poverty among women-headed households by 22 percent.”
Facebook is also working on a new subsidiary to develop a digital wallet called Calibra, which will hold and dispense Libra once the currency is released. Calibra would have its own app, the wallet will be folded into Facebook mobile products, including WhatsApp and Messenger.
“The move brings Facebook in line with the global digital payments industry. Tencent’s WeChat, the giant social network in China, already has a digital wallet,” NPR’s Aarti Shahani reports. “In India, there’s Paytm. In Kenya, there’s M-Pesa. A lot of the so-called emerging markets implemented this technology early on because their citizens don’t have bank accounts, but they do have mobile phones.”
Shahani adds: “Most Facebook users are overseas. The largest user base is India.”
To make th ecurrency accepted by all , each Libra coin will be backed by a reserve of “financial assets,” according to the new Libra website. .
Facebook also faces others problems in the trust department: Critics say it already has too much power — doesn’t do enough to protect its users’ privacy. Last year US was worried about the potential useage of Facebook users details.
In an attempt to address potential security concerns about the new cryptocurrency Libra , Facebook said that “Calibra customers’ account information and financial data will not be used to improve ad targeting on the Facebook family of products.”
Only in “limited cases” would Calibra “share account information or financial data with Facebook or any third party without customer consent,” according to the company. That includes instances in which data could be shared out of a need “to keep people safe, comply with the law and provide basic functionality to the people who use Calibra.”
Libra’s original founders includes more than 20 high-profile companies that hope to expand acceptance of the new currency. They also hope to keep its value stable, and each founder will maintain a server that will be a node in the Libra blockchain network that will validate transactions.
Each of those founding companies is paying a minimum of $10 million into libra’s currency’s reserve. Just as founding members, Facebook will get only one vote in its governing association. If the new currency succeeds, the founding companies and other early investors would stand to receive interest from the Libra reserve fund.