Libra and Calibra: Facebook Unveils Its Big Cryptocurrency Plan

Pound is the name of the cryptocurrency that Facebook is developing and plans to launch by 2020. But it won't be called "Facebook's Bitcoin": it's a radically different project from cryptocurrencies as we have known them so far. To begin with, it will not be a speculative asset, but a moneta digitale whose value will be backed by a reserve of tangible financial assets. In short, this means it will be much less volatile than Bitcoin and all other cryptocurrencies.

Furthermore, Libra does not will be of Facebook, but of the non-profit organization Libra Association. Each member of the association will have one vote: today the organizational chart already has 29, with non-profits, investment funds and companies active in many different sectors – for example Spotify, Mastercard, Vodafone, PayPal, Iliad, Lyft, eBay, Booking, Uber and Visa – and the goal is to recruit “hundreds” more before the launch. It is true, however, that Facebook will have two votes, while the others will have only one: one is from Facebook itself, the other is from the subsidiary (and recently formed) Calibra, the wallet for Libra through which Zuckerberg's social network plans to earn money (we'll get to that in a moment). Facebook is currently in charge of Libra development, but will hand it over to the Libra Association by the end of the year.

In Facebook's plans, Libra will one day allow you to pay for services both online and offline, and will become the first truly mainstream cryptocurrency, with a value as stable as the dollar, decentralized and global, usable in any context and with broad support for modern financial products, such as loans, mortgages and financing. In the early stages, however, its main use is expected to be the transfer of money from one person to another, especially in the poorer parts of the world.

It is precisely on this last demographic that Facebook is banking heavily, with Libra: the giant observes that approximately 31% of the global population, that is 1,7 billion people do not have access to a banking system because it is too expensive. A free/low-cost alternative, such as Libra, could have immense effects on the quality of life. It is interesting to note that there are also financial companies (Visa and Mastercard) involved in the project, with the promise that other banks will also arrive: the goal is not to compete with traditional methods, but to collaborate with them in order to evolve the entire sector.

The goal, in concrete terms, is to improve financial inclusiveness and do for the transfer of value and payments what the internet has done for the transfer of communications and information. – Dante Disparte, Head of Policy and Communications, Libra Association.

Facebook has already made the blockchain underlying Libra open-source (Apache 2.0 license), so that developers can start creating dedicated software. It is a blockchain, Facebook says, built from the ground up with scalability, security, storage and throughput efficiency, and ease of adaptation to future needs in mind. Facebook also says that Libra will commit to interact with legislators and experts to ensure that the infrastructure is “governed in a way that reflects the people who use it.”CALIBRA

Calibra it will be, as we were saying, the Libra digital wallet. In practice it is a subsidiary of Facebook, headed by Kevin Weil, who was a senior executive at Twitter and Instagram in the past. Calibra will be integrated into apps like Facebook Messenger and WhatsApp, but will also be available in dedicated apps for Android and iOS. Over time, Calibra will allow Facebook to develop financial services such as lines of credit. The plan is to offer fees that are much lower than those of traditional banks.

Initially, as we said, the goal will be to transfer money from one person to another with zero or almost zero fees; but in the future, Facebook imagines that Calibra will allow you to pay bills with the simple press of a button, a restaurant bill by scanning a code, or access public transportation without needing tickets or money. Calibra will include all the anti-fraud security measures that banks use, dedicated support and Money Back Guarantee for Fraud Victims. Calibra will not share personal financial or account data with Facebook or any third party without your explicit consent (except in some rare cases, such as when sharing data is necessary to protect the safety of individuals. HEREmore details).