Facebook made a recent announcement that created shockwaves in the cryptocurrency world.
On the 18th of June, Mark Zuckerberg announced that Facebook would be launching their own version of cryptocurrency called ‘Libra’.
The crypto coin has been developed as a method of digital payment. So you’ll be able to buy and sell items with Libra. It can also be used to make international money transfers for near zero transaction fees.
Libra Facebook Cryptocurrency Launch
The coin is due to be launched in 2020, but news of its arrival has got people talking. It has also affected the crypto market too. In fact this development may have even affected the recent Bitcoin price upswing which happened after the news came out.
Although it is always hard to determine the exact cause of the Bitcoin price jump, it is very likely down to this latest announcement from Facebook.
After the news, the Bitcoin value grew beyond $12,000! This was a big price increase and traders took notice, especially because the Bitcoin value has been reasonably steady since the Bitcoin price decrease in 2018.
However, that fact that Facebook will launch their own cryptocurrency has in turn boosted the crypto market and affected prices.
The news has made important companies and financial institutions realise just how important cryptocurrency is for the future.
So far cryptocurrency has only been used by a reasonably small and select amount of people globally. With Libra this is likely to change.
Investors and financial analysts are optimistic that the crypto will be used by the public and have mainstream appeal. Hopefully this will encourage more people to consider using cryptocurrency.
Even though Libra is scheduled for public launch in 2020, there’s already been some debate regarding privacy issues and whether it can be classed as a true cryptocurrency.
Libra: cause for concern
Facebook released their white paper on Libra this month and experts have been looking at potential problems that might arise with it.
On first glimpse the idea seems harmless enough. Libra will be open to the public and you’ll have the chance to spend and withdraw your digital funds either at local exchange places or online.
In order to do so you will need access to Facebook’s Calibra wallet or an external e-wallet app. This is where the digital funds will be stored.
The Calibra wallet app is currently under development by Facebook and will be available as standalone app, or compatible with Messenger and WhatsApp. Calibra will deal with all your crypto transactions and store any Libra coins purchased.
One privacy concern that has been raised though is data ownership. Would Facebook will be able to access individual transaction data which could be sold for advertising data. Especially as they are in ownership of both Libra and Calibra.
Libra vs Regulators
One issue that could delay Libra’s planned 2020 launch could be interference from Government and regulatory bodies.
Since the announcement, economists have already warned that it could potentially challenge Government’s control over their national monetary policies. Libra may have the power to disrupt and undermine democracy. This has caused regulators from various countries to say that they’ll be investigating Libra before its launch date.
If after investigation a Government should decide to outlaw the digital currency, it’ll be interesting to see how Facebook reacts to the matter.
However, seeing that Facebook has been caught up already in legal disagreements with Governments already, the future outlook looks concerning. Many of you will remember Mark Zuckerberg being grilled by the European Parliament in 2018 over data breaches.
We’ll have to see what happens in 2020, but should the Libra project come under Government scrutiny, then it’s possible that the project may be pushed back or even cancelled.
Libra Facebook Privacy & Data
With the privacy and data breaches that Facebook has faced, privacy concerns were mentioned regarding the Libra news.
However, Facebook has made clear that Calibra will not breach users’ data or privacy. Any payments will be kept completely separate from your Facebook account. Your account or real identity is not linked to any publicly made transactions.
This statement may reassure some, but with Facebook’s access to millions of companies and small businesses which pay for targeted ad data, it’ll be interesting to see if it’s convincing enough for the public.
For some though, Libra may represent more positive outcomes, such as the chance to send money instantly with fewer fees.
It has also been pointed out that as long as you have access to a smart phone and the Calibra app, you’ll be able to have digital access to funds. This is a great opportunity for people who remain ‘unbanked’ or without access to a traditional bricks and mortar bank.
We’ll all know more once Libra is finally launched next year. But it’ll be interesting to see if this new crypto will change the cryptocurrency world for better or for worse.
One thing is for certain though, the new crypto will definitely shake things up in the cryptocurrency trading market here.