So much is going on in Facebook’s house, and one of the main focuses is Libra. Facebook is the largest social media company in the world, yet they are doing much more to ensure they broaden their reach into the global population. Their latest mission has triggered many concerns and issues across the world.
Early this year, the announcement of Facebook’s cryptocurrency- Libra – started a stir that is still going on with leaders, politicians and other high-ranking officials, each expressing their different views and opinions on the social media giant’s intentions to introduce their own cryptocurrency.
In October, Mark Zuckerberg, the CEO of Facebook, appeared before the House Financial Services Committee to officially announce that Facebook is expecting to launch Libra, their digital cryptocurrency somewhere in July 2020.
But what is it?
Libra is a new digital currency that is expected to be launched by Facebook. The social media company is referring to this digital coin as ” a global currency and financial infrastructure.” According to Zuckerberg, it will allow users to make online financial transactions from anywhere using the new currency. Basically, it is similar to Bitcoin and other cryptocurrencies, but it built by Facebook and powered by a new Facebook-created version of blockchain.
The idea behind Libra is that as soon as a digital coin is created, a basket of assets and currencies will then be held within the reserves of Libra. As a result of this, Facebook will be able to build an intrinsic value for its cryptocurrency.
In addition, in order to make Libra more accessible as a currency, Facebook will enable it to be transferred as easily as sending a text message.
However, such a global currency and coming from a mega-corporation such as Facebook whose ethics have been questioned in the past, is what is worrying lawmakers and others. For example, during the October hearing before the House Financial Services Committee, CEO Mark Zuckerberg fumbled when answering some of the questions posed to him on how Facebook was planning to make money as well as the funding of the Libra Association.
Another case that brought more worries to the Lawmakers, is that Zuckerberg could not clearly explain the policies meant to deal with any fraudulent transactions within the system.
California Rep Maxine Waters said in her opening statement to Zuckerberg that after examining various problems facing Facebook, it would be beneficial if Facebook would first address their existing failures and deficiencies before going any further with the Libra Project.
According to the Financial Times, many experts and analysts are not impressed with Libra, and as a result, Stripe, Visa, eBay, and Mastercard are no longer interested in participating in Facebook’s Libra Association.
According to a statement by analyst Moffett Nathanson, is that Libra will fail if there is no involvement of main players since they are the key to global acceptance, settlement networks and bring a better relationship between government, regulatory bodies, and financial institutions across the world.
It remains to be seen where to from here and the big question is whether Facebook will be able to Libra’ate their new cryptocurrency.