Facebook announced a digital currency called Libra that will roll out for use in 2020 and allow the platform’s billions of users across the globe to make financial transactions online.
About:
What is Libra? Facebook says Libra is a “global currency and financial infrastructure”. It is a digital asset built by Facebook and powered by a new Facebook-created version of blockchain, the encrypted technology used by bitcoin and other cryptocurrencies.
Why is Facebook launching a cryptocurrency? Facebook claims it wants to reach the 1.7 billion people around the world who do not have access to a bank account.
Calibra: When the cryptocurrency launches, users can download Calibra, a digital wallet, that will allow them to send it to anyone with a smartphone. It will be available in Messenger, WhatsApp, and as a standalone app.
Who is in charge of Libra?
The currency will be serviced by a collective of companies called the “Libra Association”, an independent, not-for-profit organisation based in Switzerland.
It functions as what is known as a “stablecoin”, pegged to existing assets like the dollar or euro, in the aim of making it less subject to the volatility that many cryptocurrencies experience.
Way ahead: The currency will be launched in 2020. However, the company is likely to run into regulatory hurdles and antitrust concerns, especially at a time when many regulators want to break up Facebook. There are a number of privacy concerns regarding a financial app run by Facebook.
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