Give Facebook All Your Money
Doomsdayers like to talk about the one world government (probably the dastardly UN), creating a unified single currency that can only be accessed via the mark of the beast. But this wasn’t even the worst case scenario. What if it was only accessible by, God help us all, Facebook.
Earlier in the year, Facebook dropped the whitepaper and announcement for their new coin called Libra and immediately had kickback from the entire planet due to the vague details and ominous possibilities.
Libra is a new cryptocurrency which, if it does what it says on the tin, protects us from the dangers of Fiat currency and it’s wiley ways. One second you’re the British Pound, the next you’re a Venezuelan IOU. Why trust governments when you can trust corporations, amiright?
To make it impervious to fluctuations, Libra will be backed up by a slush fund of Fiat currencies and government bonds from around the world, making it a type of cryptocurrency called a “stablecoin”, a crypto that’s backed by real world assets. Facebook has admitted that it can never be truly stable, due to the very nature of basing its value on Fiat currency. But this is how the coin differs from Bitcoin, which is only backed by their scarcity and the deeply held belief that they could be worth anything. Libra doesn’t give nerds an excuse to have racks of GTX 1080 Ti’s burning away in a back room earning slightly more money than they’re spending in electricity. You can mine bitcoins, but the only way you can get Libra is by paying or trading for it. They do both, however, run on the magical ledger of blockchain technology, and all records of coin movement will be publicly available. While your account will not be tied to your real world details, “data relevant to each transaction, such as the public address of the sender and receiver, the timestamp, and the transaction amount, are recorded and publicly visible.”
At the end of the day, you can exchange your Libras back into real money, which is extracted from the reserve.
This reserve is being kickstarted by corporations willing to chip in and have a say over how the coin is run. With an investment of at least $10 million, you can buy yourself a Libra investment token and get a vote in the Libra Association based in Switzerland. Major Policy is then made by a two-thirds vote. While holders of these tokens can never have more than 1% of the vote, they will receive interest proportional to their investment, so they have a vested interest in making Libra fly.
It’s hard to see the application for Libra when the regular punter could just use real money, however with the likes of Ebay, Vodafone and Visa, among others all buying Libra investment tokens, it’s not difficult to imagine them giving benefits to customers willing to buy into it. For instance, Ebay could offer discounts and other incentives for people willing to wheel and deal in the currency.
The public discourse surrounding the coin has been vehement, perhaps due to the fact Facebook hasn’t had a great reputation for well, pretty much anything really. While some have argued that it’s not technically Facebook’s coin, more of an offshoot independent company, it still has enough of Facebook’s stink all over it to make people wary. For instance, Facebook will have it’s own wallet for storing Libra called Calibra. Knowing how people would react, Calibra came out quickly to say that “Calibra customers’ account information and financial data will not be used to improve ad targeting on the Facebook, Inc. family of products.”
However, data will be shared in limited cases to comply with certain laws and “provide basic functionality to the people who use Calibra,” such as being able to import Facebook contacts.
“In just a few short years, Facebook has earned a level of distrust that took the banking sector much longer to achieve.” writes Nobel Prize-winning economist Joseph Stiglitz.
“Time and again, Facebook’s leaders, faced with a choice between money and honoring their promises, have grabbed the money. And nothing could be more about money than creating a new currency.”
Unlike Doge Coin and all the other misfit crypto’s out there, governments are seeing Libra as a much more tangible threat.
“If products and services like these are left improperly regulated and without sufficient oversight, they could pose systemic risks that endanger U.S. and global financial stability,” Rep. Maxine Waters (D-CA), the chairwoman of the House Financial Services Committee wrote. “These vulnerabilities could be exploited and obscured by bad actors, as other cryptocurrencies, exchanges, and wallets have been in the past.”
Even China is sitting up and paying attention. Wang Xin, Director of the People’s Bank of China questioned it’s application. “If [Libra] is widely used for payments, cross-border payments in particular, would it be able to function like money and accordingly have a large influence on monetary policy, financial stability and the international monetary system?”
China in particular is keeping an eye on Libra. They’ve been considering making their own sovereign coin since as far back as 2014. This sudden announcement from an American-owned company might be the fire that needs to be lit under the Chinese to get their own coin out the door.
It may not be the end times, but these announcements have kicked off a new era for cryptocurrency one way or the other. Is it what the world needs right now?
