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Facebook announces Libra cryptocurrency: All you need to know
Facebook has finally revealed the details of its cryptocurrency Libra, which will let you buy things or send money to people with nearly zero fees. You'll pseudonymously buy or cash out your Libra online or at local exchange points like grocery stores, and spend it using interoperable third-party wallet apps or Facebook's own Calibra wallet that will be built into WhatsApp, Messenger, and its own app. Today Facebook released its white paper explaining Libra and its testnet for working out the kinks of its blockchain system before a public launch in the first half of 2020.
Facebook won't fully control Libra, but instead get just a single vote in its governance like other founding members of the Libra Association including Visa, Uber, and Andreessen Horowitz who've invested at least $10 million each into the project's operations. 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.
Facebook is launching a subsidiary company also called Calibra that handles its crypto dealings and protects users' privacy by never mingling your Libra payments with your Facebook data so it can't be used for ad targeting. Your real identity won't be tied to your publicly visible transactions. But Facebook/Calibra and other founding members of the Libra Association will earn interest on the money users cash in that is held in reserve to keep the value of Libra stable.
Also at Business Insider and The Verge.
See also: Facebook announces new cryptocurrency called Libra - business live
Facebook's Answer to Bitcoin Poses a Double Threat
How Libra Would Work for You
Previously: Facebook Cryptocurrency
Facebook Plans to Launch 'GlobalCoin' Cryptocurrency in 2020
(Score: 5, Informative) by bradley13 on Tuesday June 18 2019, @06:16PM (12 children)
Here's a quick summary of the most important points from the Libra White Paper [scribd.com].
Facebook wants to offer not just a currency and payment service; they want to offer financial services - basically, Facebook wants to become a global bank. These financial services will be run by a wholly-owned subsidiary called Calibra, which will presumably be subject to banking regulations.
The Libra currency
The currency itself is managed by a not-for-profit organization independent of Facebook. Membership in the organization is "formed from the network of validator nodes that operate the Libra Blockchain.
Note that this group is by invitation only: you can't just start running a Libra validator node. The initial members include major payment services like Mastercard, Visa and PayPal. Otherwise, it includes a rather odd array of big tech companies, including for example both Uber and Lyft.
Technical highlights of Libra: (1) it includes a programming language, and will be able to run smart contracts, (2) it uses Byzantine Fault Tolerance (BFT) for consensus rather the proof-of-work or proof-of-stake, (3) it does not require your Libra address to be tied to a real-world identity; hence, it is pseudonymous in the same way as Bitcoin.
The currency will be backed by assets, with the goal of creating a stable exchange rate against real currencies. The assets come from the initial members of the Libra Association; profits from investing the reserve will be used to cover expenses and otherwise be paid to the founding members.
New Libra coins are only minted when purchased with fiat currencies, which are then added to the reserve to back those new coins. Coins are destroyed when sold in exchange for fiat assets. These creation/destruction actions only apply to authorized organizations, which trade directly with the central asset pool (rather like national banks, except that money is only printed against real, retained assets). Outside of these authorized organizations, trade between individuals or organizations neither creates nor destroys Libra coins.
The Libra source code is available under an Apache license; a testnet is currently running.
Everyone is somebody else's weirdo.
(Score: 2, Disagree) by DannyB on Tuesday June 18 2019, @06:40PM (1 child)
Can't we just get one single mandated global digital currency already?
To transfer files: right-click on file, pick Copy. Unplug mouse, plug mouse into other computer. Right-click, paste.
(Score: -1, Offtopic) by Anonymous Coward on Tuesday June 18 2019, @06:48PM
i saw ur post read it and i thought this was shitpost
boy was i wrong
(Score: 2) by richtopia on Tuesday June 18 2019, @06:47PM (5 children)
Thanks for the summary. I'm not a cryptocurrency expert, but this seems like a reasonable attempt at a fiat-backed cryptocurrency. Naturally, with this type of currency you have a central stakeholder (Libra foundation) that decides the rate that coins are "purchased" (I'm not sure what the correct verb is... minting seems inaccurate as the coins are generated only when backed with capital).
My paranoia alarms are going off with anything started by FB, but if they can somehow democratize the organization to be truly independent I would be willing to consider the currency.
(Score: 2) by bradley13 on Tuesday June 18 2019, @08:11PM (2 children)
Yeah, I feel exactly the same way. Everything they've announced sound so reasonable, really good even. But...it's Facebook. Also: This isn't going to disrupt the credit cards, who frankly are the major global players in consumer transactions, because the credit cards are some of the Libra founders.
On the other hand, Facebook's motivation may be simple greed. Tney've founded a subsidiary that is basically going to be a bank. And they may sincerely hope to disrupt the banking industry, using Libra as a lever. Maybe the lever they've constructed isn't evil.
We really could use a truly international currency outside the control of any particular nation. That's what some people thought Bitcoin (or ETH, or some other cryptocurrency) was going to be, though it never really had a chance. Having the Libra Association based in Switzerland is a good step towards keeping it independent of national politics - Switzerland isn't perfect, but it's a better choice than anything else I can think of.
Dunno...we'll have to see what happens in the next year or three...
Everyone is somebody else's weirdo.
(Score: -1, Offtopic) by Anonymous Coward on Tuesday June 18 2019, @11:18PM (1 child)
Btc never had a chance? Amazing how delusional people still are about what's happening. No gov or corporate coin has a chance because they will never agree to what "fair" to all interested parties, just look at what happened to SDRs.
Meanwhile bitcoin chugs along exactly as planned (just read the first few years of bitcointalk posts to see literally everything that has come to pass was perfectly predicted back then) and you'll be adding the coming ETF to your retirement account at $100 to $1k per mbtc in a few years.
(Score: 0) by Anonymous Coward on Wednesday June 19 2019, @12:40AM
If only I could understand the mind of people who just downvote stuff they don't want to hear... even if it makes them poor.
(Score: 2) by coolgopher on Tuesday June 18 2019, @11:53PM
Ah, you mean like it's tethered [wikipedia.org] to a fiat currency? Yeah that will totes be guaranteed safe!
(Score: 0) by Anonymous Coward on Wednesday June 19 2019, @04:51PM
why would you voluntarily line up for the slave auction? why not use monero like a free person?
(Score: 3, Informative) by Fnord666 on Tuesday June 18 2019, @09:45PM
The important thing to understand is that Facebook's Calibra is something separate from Libra. Libra is the cryptocurrency and the network to manage that. It's run by a number of large scale investors with significant buy-in. They make money on the interest earned off of the Libra Reserve, the real world capital that is being held when Libra coins are minted. They don't make money unless the whole network succeeds. Facebook is one of those investors, but just one of many.
Calibra on the other hand is a wallet implementation that will interact with the Libra network to perform your transactions. The other major investors are likely to have their own wallets, and if you don't like any of those you can write your own. As long as your wallet abides by the protocols you're good to go. If you're interested, the developer page can be found here [libra.org].
(Score: 0) by Anonymous Coward on Tuesday June 18 2019, @10:21PM (1 child)
So, is it going to make a more correct version of cyberpunk dystopia we are currently living in? 🤔
(Score: 0) by Anonymous Coward on Tuesday June 18 2019, @10:53PM
It's a long road to 2077.
(Score: 0) by Anonymous Coward on Wednesday June 19 2019, @02:42AM
Actually the LibraBFT paper [libra.org] claims it is "designed as a proof-of-stake system, where participation privileges are granted to known members based on their financial involvement."
Furthermore the paper states "Initially, the participating validators will be permitted into the consensus network by an association consisting of a geographically distributed and diverse set of Founding Members" but that "Over time, membership eligibility will shift to become open and based only on an organization’s holdings of Libra."
Also interesting is how it states "LibraBFT maintains consistency among honest validators, even if up to one-third of the validators are corrupt" - so, not a 51% attack but more like a 34% attack.