You know, it all seems inevitable. Of course a major tech company is going to develop its own blockchain. Of course a well connected consortium of VC backed companies would try to take on the East Coast banks. Of course it would be one of the FAANGs.
Facebook has been talking about this for a while, so it should come as no surprise for those paying attention. Today, we're able to read what Libra is all about.
Libra promises to be a stable token that will act as a sort of digital dollar. It will be seamlessly used within Facebook's applications, as well as many partnering companies, to make paying with your smart phone even easier than it is now.
According to their website, Libra is not going to peg its price to the US dollar. Instead, it will be backed by "assets (which) will be a collection of low-volatility assets, including bank deposits and government securities in currencies from stable and reputable central banks."
In other words, Libra is not an electronic US Dollar, but something else completely.
The company with the fifth largest market cap in the United States is creating a private currency to compete with the Federal Reserve.
Go Big or Go Home
Facebook has over 1 billion users. It's difficult to overstate the implications of a company with some of the most detailed user data of more than 10% of the world's population having control over their money supply.
They've also got a list of partners that is a "who's who" of tech. Check out this partner list:
This is Silicon Valley's Ring of Sauron. I seems incredibly difficult to imagine this power is used wisely. Here are a few comments/questions I have that will guide how I follow this development:
- According to the website, Libra will originally be a permissioned system, which means Facebook can decide who is a part of the network of validators (the computers that relay transactions) and who is not. Implicitly, they're also able to decide who can use their token and who cannot.
- It is likely validators will pay $10 million for the privilege. What kind of data are they getting in return for this huge amount?
- Libra's stated intention is to move towards a more decentralized platform, but it's difficult to believe considering the enormous amount of power they would forfeit to do this.
Will Libra Kill Other Cryptocurrencies?A big question I have seen a lot today is whether Bitcoin and Ethereum will die. Libra will use smart contracts, like Ethereum, using a new programming language called Move. With a ton of money, and the incredible network of Partners listed above, Libra is in a prime position to take all the lessons learned from 2017-Present and get blockchain tech into millions of homes within a few years.
Can Bitcoin and Ethereum adapt? Will Steem survive?
What can your favorite cryptocurrency offer that won't be done better and faster by the high powered teams of developers with Libra behind them?
My Predictions for Libra
Nobody knows the future. But, it's fun to write down some guesses to see what will happen in the next few years. None of these predictions are investment advice, but you already knew that.
I think that cryptocurrencies and blockchains that are most resistant to censorship will be in the best position to succeed. If Libra succeeds, there will still be a real need for privacy coins like Monero and ZCash. There will be a huge need for Decentralized Exchanges that allow peer to peer trading.
"Blockchains of blockchains" like Polkadot and Cosmos might do well, if they're willing and able to integrate Libra.
If Ethereum 2.0 releases on time (no pressure devs!), with scaling and privacy features, it could be a serious contender against Libra.
The biggest losers will be mid and low level smart contract platforms that are already racing to get ahead of Ethereum in a novel way. After the 2018 bear market, it's difficult to imagine developers will race to any of these platforms that will have to compete even harder for mindshare.
Probably the biggest battle Libra faces will not be against Ethereum, but against the Federal Reserve and the US Government. Get your popcorn.
Those are my predictions, and they'll live on the Steem blockchain so we can look back and laugh, cringe, or cry in a few years.
These are just my thoughts from reading Twitter and Reddit reactions today. What are your thoughts on Libra? Let me know in the comments below!
Posted from my blog with SteemPress : https://steemmaker.com/facebook-goes-crypto-libra/