Facebook announced plans for its in-development global cryptocurrency, called Libra which will be launched next year alongside its own blockchain-based network that will hold it up.
The new currency will be a form of digital money backed by a reserve of assets, unlike Bitcoin that is currently a speculative asset which means one day you will be making your online or offline payment using libra said Facebook Executive.
Initially, the company pictures Libra will be used mainly to transfer money between individuals in developing countries who lack access to traditional banks.
Eventually, the main objective is to create the first truly mainstream cryptocurrency: a decentralized global form of payment that is as stable as the dollar, euro, pound, yen or any other currency around the world that can be used to buy almost anything, and can support an entire range of financial products from banking to loans to credit.
While developing Libra the company has also established a nonprofit Libra Association with 27 other partners to oversee Libra and its development. The partnership includes venture capital firms, nonprofit organizations, crypto firms, and massive corporate finance, telecommunications, and technology service providers, including Coinbase, Mastercard, Visa, eBay, PayPal, Stripe, Spotify, Uber, Lyft, and Vodafone.
Those organizations will also contribute to what is known as the Libra Reserve, the asset pool that will ensure every unit of Libra currency is backed by something of intrinsic value rather than by simple scarcity, as Bitcoin is.
Calibra, a new subsidiary of Facebook which the company is launching to build financial services and software on top of the Libra blockchain.
First look of Calibra performs similar to any payment company but the major advantage of Calibra over its rivals is the integration of the service with the gigantic user base of Facebook.
Calibra could be the next Big Thing for Facebook.
Calibra’s quick goal is to develop and launch its own digital currency wallet and integrate that wallet into other Facebook products. Calibra will become the partner of the Libra Association partners so the service won’t be only controlled by Facebook only.
This is a huge play for Facebook as the company moving forward with the digital currency like no other tech companies has ever moved with and simply just take it as a Bank of Facebook — an arm of the social network that hopes to do for loans, credit, money transfer, and commerce what its suite of apps has done for online communication.
“WE WANT TO MAKE SENDING MONEY AS EASY AS SENDING A TEXT MESSAGE.”
Kevin Weil, VP of Product at Calibra says that the digital wallet features will come to Facebook Messenger and WhatsApp. But Calibra will also exist as a standalone iOS and Android app for those who don’t have Facebook accounts.
Weil says that Calibra won’t use users data to be used for ads in Facebook and the users data will only stay in Calibra account.
The future of sending money is looking bright for users but it will be really tough for the payment companies to survive and stand against the company named Facebook