When Mark Zuckerberg announced Facebook’s new direction on June 18, 2019, the entire world stood up and took notice. It is not as though cryptocurrencies were not present before 2019. Bitcoin, Ethereum, Litecoin, and others are worth more than billions of dollars in valuation.
However, all of them suffered from a serious flaw- they were not mainstream. Facebook understood its prowess, influence as a tech giant, and sought to rectify the single biggest problem in the digital currency ecosystem.
What is Facebook’s Libra: A Brief Introduction-
According to Libra’s official website, Libra is a simple, fast, stable, secure and truly global digital currency. It aims to convert our existing economic ecosystem into a truly global one. This is something that other digital currencies have suffered from.
Even though they have wanted to establish it as a pan-global entity, they have never had the dominance to influence governments and financial institutions to execute this. Facebook, with its power, resources, and expertise would want to chart a different path altogether.
According to Mark Zuckerberg, global economics is dictated by undue interference from national governments and financial institutions. This makes currency essentially a volatile entity. In order to create a stable environment across borders, Libra will aim to be independent of government interference. It would seek to create its own value through its own reserve of assets. This will empower it to command a currency value that is stable in Africa, South America, Asia, Europe and elsewhere.
Does Blockchain Technology back Libra?
Absolutely! Blockchain is at the foundation of Libra’s existence. This is what guarantees the speed of transactions, the security embedded in the chain, and the reduction of undue expenses and fees.
Facebook says that the Blockchain will be always operated by something known as ‘Validator Nodes’. It aims to empower the Founding Members of the Libra Association with decentralized and responsible ownership of each validator nodes.
This is in stark contrast to other digital currencies. Validation of transactions is going to be made when it comes to Libra. This will help add a layer to the already sophisticated security in the near future. However, Zuckerberg was quick to point out that as and when the Libra Network becomes sizable, these Validator Nodes will disappear.
His vision for Libra is that of a ‘permissionless’ entity, that is truly global and truly democratic.
What makes Facebook’s Libra stand apart from its competition?
Every major cryptocurrency starts with a fundamental flaw. Traditional financial systems are much more acceptable and solid as they are always backed by physical assets. You might have heard of the Gold Standard and so on.
Creating money out of thin air is something that has prevented digital currencies from going mainstream. Facebook’s Libra seeks to rectify this by creating a digital currency backed by the valuation of real physical assets. This will help it maintain a stable character and improve its chances of getting accepted by national governments, people and financial institutions.
Charters, rules, regulations, and boards govern the world’s biggest financial institutions and banks. Facebook aims to emulate this hierarchy and establish a top-down governance approach based on Rules, Regulations, and Boards. It labels it as the ‘Libra Association’.
Every change in a rule or any amendment would always be ratified in a traditional manner according to the models of established financial entities the world over. This will help in increasing stability and decrease volatility.
For people looking to invest in Libra, now is a perfect time. Everyone remembers the valuation of Bitcoin when it first started in 2009. Several Trading Platforms have set up by cryptocurrency experts to help regular people maximize their profits from initial investments in Facebook’s Libra.
One such platform is the Libra Maximizer. It helps people with complex algorithms and enables them to make complex trade in an easy fashion. Early birds can expect up to a thousand dollars of profits in one week alone from the Libra Maximizer.
Are you going to invest in Facebook’s Libra? Do let us know in the comments section below.
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