Facebook’s libra cryptocurrency: what you need to know
It’s not bitcoin. It’s also not Venmo. It’s more like an attempt at the internet-age US dollar.
Libra White Paper Shows How Facebook Borrowed From Bitcoin and Ethereum
Libra’s designers have picked what they see as the best features of existing blockchains while providing their own updates and refinements.
Facebook Has Not Applied for RBI Approval to Operate Libra in India: Report
Facebook’s Libra may not be available in India due to the current ban of blockchain-based currency transactions. Apparently, Facebook has not applied for approval with the Reserve Bank of India to operate its digital currency in the country.
Paysend Launches Pays XDR – the Stable Coin
UK-based Paysend Group is launching a new global digital currency, Pays XDR. This stable coin is 100% backed by cash reserves and the reserves are matched in the exact proportion of the IMF’s Special Drawing Rights.
Global Policy Makers Are Up in Arms About Facebook's Libra Coin
“What are they doing with the money, if I give them some dollars to buy the Libra, they’re kinda being fuzzy about that in their whitepaper…The strength of the collateral is a question I would have about it.”
The Libra Masterplan
Facebook is very knowingly exploiting a very specific gap in regulations and technology made possible by the cryptocurrency industry that will allow their planned “Libra” cryptocurrency to flow into the black market economy while still being compliant with traditional financial entities’ compliance policies.
Flip Sides of Facebook’s Proposed Cryptocurrency
We need a product that fully disrupts the woefully inefficient global payments system and starts to break the power of the big banks. If Libra launches (the regulatory challenges are not small) and works as a frictionless, almost free and very fast global monetary transmission mechanism, it could be that product. However if it is, it won’t be because it is mimicking “real” cryptocurrencies. It will be because it isn’t.
Facebook wants to create a global currency
Were every Western depositor to move a tenth of their bank savings into Libras, its reserve fund would be worth over $2trn, making it a big force in bond markets. Banks that suddenly saw lots of deposits leave for Libras would be vulnerable to a panic over their solvency; they would also have to shrink their lending. And the prospect of huge sums flowing across borders will worry emerging countries with a fragile balance of payments
What Facebook’s new currency means for the banking system
Individual Libra-holders face risks. One is currency fluctuations. If, say, the yen rises against the basket to which Libra is pegged, Japanese holders of Libra will lose out. The new currency will not yield interest (though neither do many bank deposits nowadays).
Launching a Global Currency Is a Bold, Bad Move for Facebook
What happens if all users want to sell their Libra currency at once, causing the Libra Reserve to hold a fire sale of assets? If the Libra system becomes intertwined in our global economy in the way Facebook hopes, we would need to consider a public bailout of a privately managed system.
France creates G7 cryptocurrency task force as Facebook's Libra unsettles governments
France is creating a G7 task force to study how central banks ensure cryptocurrencies like Facebook’s Libra are governed by regulations. Governor Francois Villeroy de Galhau said the task force would be led by Benoit Coeure, a ECB board member.
Facebook co-founder: Libra coin would shift power into the wrong hands
"A liquid, stable currency would be attractive to many in emerging markets. So attractive, in fact, that if enough people trade out of their local currencies, they could threaten the ability of emerging market governments to control their monetary supply, the local means of exchange, and, in some cases, their ability to impose capital controls."
Facebook's Crypto Libra Won't Be Legalized in Russia: State Press
Russian government-owned news agency TASS has reported that Russia will not legalize Libra.
What Libra IS & What It IS NOT
In many respects, he says, Libra is like an ETF for a basket of currencies, except that Libra will not trade on regulated exchanges. In fact, it is so much like an ETF, the US SEC is likely to at least contemplate asserting jurisdiction over the tokens.
Why closed-loop systems like Libra won't change the world
SWIFT: "We don’t think that cross-border payments challenges should be solved for with closed loop systems. Doing so would easily solve for a subset — or multiple subsets — of participants, but value needs to move everywhere — from every account, to every account. Loops create barriers and friction; they reduce fungibility and portability, they limit competition and they fragment liquidity."
Libra's Dirty Secret: Blockchain Firm Claims Facebook Stole its Crypto Model
Hedera executives believe that Facebook potentially hijacked their idea for a council of trusted companies to operate a blockchain, but that the company probably hasn’t broken the law in any way. Hedera hoped to strike a partnership with Facebook, and build their crypto project on a finished product.
Can Facebook Help Reduce the Cost of Remittances?
One of the most important areas that could be impacted by Libra is remittances, i.e. money transfers by migrants to their families back home, which have proven to be a crucial driver of economic development. According to the World Bank, remittances to low- and middle-income countries reached a record high of $529 billion in 2018, with total remittances climbing to $689 billion. The problem being that sending money to people without access to a financial system, especially in regions most reliant on remittances such as Sub-Saharan Africa, is difficult and costly.
<div class="row"><header class="article__header"><h3 class="hl-module text-color--gray-light margin-bottom-0">
Remittance Costs
</h3><h2 class="hl-article article__title">
Can Facebook Help Reduce the Cost of Remittances?
</h2></header><footer class="article__meta"><div class="article__editor"><span>by </span><address class="infographic__author"><a rel="author" href="mailto:[email protected]">Felix Richter</a>,
</address>
</div><time class="infographic__date infographic__date--published" datetime="2019-06-20" title="June 20th, 2019">
Jun 20, 2019
</time><div class="article__topic showMobile"><i class="fa fa-tag"></i>
Financial market in Africa
</div></footer></div><div class="row margin-bottom-15"><div class="width70 padding-right-15"><div class="article__contentText"><p></p><div id="dc-content" class="float-right hideMobile margin-left-20 margin-bottom-10" style="display: none;" data-google-query-id="CK_aiq3J_-ICFQPz4Qod0_kPfg"><div id="google_ads_iframe_/563787768/en.statista_1__container__" style="border: 0pt none; width: 300px; height: 250px;"></div></div>
Having successfully <a href="/chart/10047/facebooks-monthly-active-users/" target="_blank" rel="noopener">connected large parts of the world</a> through its social media and messaging platforms, Facebook is now taking on a new project: creating a “more inclusive global financial system”. The world’s largest social media company introduced a new cryptocurrency named Libra this week, which will be run by the <a href="https://libra.org/en-US/vision/" target="_blank" rel="noopener">Libra Association</a>, an independent, non-profit organization based in Geneva, Switzerland, whose founding members include companies such as Mastercard, Visa, eBay, Uber, Spotify, Vodafone and, of course, Facebook itself, among others.
<br><br>
“Libra’s mission is to enable a simple global currency and financial infrastructure that empowers billions of people”, the currency’s mission statement reads, adding that despite all progress made in connectivity and access to information and services, “1.7 billion adults globally remain outside of the financial system with no access to a traditional bank” and that “access to financial services is limited or restricted for those who need it most — those impacted by cost, reliability, and the ability to seamlessly send money”.
<br><br>
One of the most important areas that could be impacted by Libra is remittances, i.e. money transfers by m</div></div></div>
How to become a founding member of the Libra Association
To be a validator node and founding member, organizations will need to meet technical requirements and specific evaluation criteria. If the conditions are met, upon approval, the Enterprise will have to make an initial minimum investment of $10 million worth of Libra Investment Tokens issued by the Association. Nonprofits will not be required to make the initial investment. However, they will have to cover the costs to run its node. It is estimated that the price for running the validator node will run approximately $280,000.
Facebook’s Libra Is a License to Print Money
The reserve isn’t quite as great as it seems, though. Like a money-market fund Libra has no capital and no deposit insurance, so any drop in the value of the reserves should mean the value of Libra falls. Losses from fraud, mismanagement or default within the reserve fall on Libra holders, unlike with a normal bank account or bank note.
This Ethereum Lottery Perfectly Explains How Facebook's Big Corporate Backers Will Profit from Crypto
To understand how early investors in Facebook’s new Libra blockchain will make money over time, it helps to dig into a new lossless lottery called PoolTogether. Its similarity to Libra is not a completely one-to-one, but the key insight of both is the same: Earning interest on your own money is good, but it’s better to also earn interest on other people’s money.
Libra's Technical Features Are Not What's Exciting
While the initial design calls for 100% reserves in developed country currencies and government debt, that’s illusory, since Libra’s controllers can change the investments at any time. Any country that allows inflation or issues dubious debt can find its currency and debt dropped from reserves. Moreover, a successful Libra would likely switch to a fractional reserve system, with only enough national currency reserves for liquidity purposes, and currency backed either by loans and other risky assets, or nothing at all.
BIS warns on Facebook risk to finance after Libra plan unveiled
The BIS has cautioned that Libra’s misuse of that data could have “adverse economic and welfare effects”. Companies could, for example, exclude high-risk groups from socially desirable insurance markets, or price discriminate by working out the maximum rate a borrower would be willing to pay for a loan.
Facebook Seeking Crypto Wallet Data Engineer, Regulatory Policy Expert
The job description gives some specifics on Facebook’s ambitions regarding the future developments of Calibra, including expanding to online and offline commerce and eventually lending and personal financial management.
A pound of flesh for your Libra inclusion
The BIS report's key point is that the entrance of big tech into finance promises all sorts of efficiency and financial inclusion gains — which is a good thing — but those gains mustn't come at the cost of other things like privacy, financial stability and market competition.
The Libra Is More Significant than You Think | AIER
Facebook’s announcement speaks to progress about private measures used to facilitate exchange, along with acknowledgement that money is best and most circulated when its value is broadly agreed to thanks to stability of the value. The Libra has the potential to mark the start of something because if widely used, it will open the eyes of the global population to a truth about money: it works best when its value is stable, plus it needn’t be a government creation.
Facebook’s Libra Must Be Stopped by Katharina Pistor
It is easy to imagine a scenario in which rescuing Libra could require more liquidity than any one state could provide. Recall Ireland after the 2008 financial crisis. When the government announced that it would assume the private banking sector’s liabilities, the country plunged into a sovereign debt crisis. Next to a behemoth like Facebook, many nation-states could end up looking a lot like Ireland.
Excited About Facebook's Libra? HOLD ON!
Libra’s main stated mission is to service the world’s poor and unbanked. Facebook’s source for the 1.7 billion figure is the World Bank’s Global Findex Database 2017. Findex also believes that 1 billion of these have mobile phones and 500 million have internet access. However, Findex also says that over half of the 1.7 billion come from just seven countries: Bangladesh, China, India, Indonesia, Mexico, Nigeria and Pakistan. More than half of these are in places where cryptos are banned, Facebook can’t freely operate, the country is under heavy FATF restrictions, or it faces other limitations.
Fitch Ratings: Facebook's Libra Blockchain May Be Viable Tech Cryptocurrency
Fitch ratings believes that Libra represents a step toward a potentially viable cryptocurrency. It incorporates and improves upon elements of existing blockchain technology, while resolving certain inherent drawbacks, such as price instability and governance challenges. Libra also seems to be designed with regulatory acceptance and lawfulness in mind.
JPMorgan to Start Customer Trials of Its 'JPM Coin' Crypto
JPMorgan Chase is to start trials of its “JPM Coin” cryptocurrency in conjunction with corporate clients.
EXCLUSIVE: After Stephen Moore's failed Fed bid, he's creating a crypto central bank | Fox Business
Economist Stephen Moore, who recently lost out on a bid to join the board of the Federal Reserve, is joining the "Decentral" algorithmic stablecoin team. Decentral bills itself as “the world’s decentralized central bank.”