Howdy Readers, So different news about facebook libra coin has been flying around the crypto space and today I decided to explain it all to those missing the truth about it here on faqontech.
I guess facebook is not new to anyone and we can tell the founder and CEO of facebook is Mark Zuckerberg and has been running and managing facebook for a long time.
If you are into cryptocurrencies then you must have heard or come across libra, people all over social media, podcasts, forums have spent weeks furiously debating the pros and cons of Libra It has been called everything from a blatant attempt to control cryptocurrencies by a big enterprise to a vehicle that will make cryptocurrencies mainstream and drive adoption.
I don’t have to give details about facebook itself let’s just dive right in facebook libra, well libra is the first cryptocurrency from facebook you might have not heard that but facebook has never launched are coin before.
After the launch of the coin have been hearing that Nigerians can’t make use of the coin or maybe africans but that I cant confirm yet.
At first, Facebook announced in May 2018 that it was starting a blockchain division that would be led by David Marcus. The reason to open this division was to research cryptocurrencies on a deeper level.
In December 2018, news came out that Facebook is building a cryptocurrency which will make it easy for them to transfer money on WhatsApp. Finally, in June 2019, Facebook formally announced Libra and released its whitepaper. The coin is expected to launch in 2020.
What is facebook libra?
According to the definition on the whitepaper – “Libra’s mission is to enable a simple global currency and financial infrastructure that empowers billions of people.” Libra has five essential components /features:
- Built on a secure, scalable, and reliable blockchain.
- It is a stablecoin which is backed by a reserve of assets.
- It is governed by the independent Libra Association.
- Uses the LibraBFT consensus mechanism.
- Smart contract coding is done through “Move” programming language.
The whitepaper starts by explaining the role of internet and mobile broadband in making information and knowledge accessible to billions of people. And there are still 1.7 billion people who lack access to a traditional banking system.
You might be wondering how is it different from other cryptocurrencies out there like bitcoin, Litecoin, bitcoin cash, Ethereum and co, you can read our guide on how to buy bitcoin & Ethereum from luno.
Facebook has built a digital wallet called “Calibra” which will be used to interact with Libra. Users will be able to send Libra via their smartphones by using Calibra.
To send funds to your Calibra wallet, Facebook will allow you to select from a list of partner payment providers, such as MasterCard, Visa, PayPal, and Stripe.
People will also be able to turn US dollars into Libra for their Calibra digital wallet, by going to local or online currency exchanges.
Facebook aims to have 100 members in its Libra Association before the launch, which in on first half of 2020 and will be managed by the blockchain.
Blockchain can be widely categorized into the following:
Libra will start as a permissioned blockchain, with the Libra Association taking care of the overall network well-being.
The main difference between Libra and other cryptocurrencies is that Libra is going to be a stablecoin which is backed by the Libra Reserve, which is a reserve of real assets.
The assets will be “a collection of low-volatility assets, such as bank deposits and short-term government securities in currencies from stable and reputable central banks.” So, let’s understand why Facebook chose a stablecoin structure and how it works.
You won’t be able to mine any Libra. Its supply will be determined by its demand. If people want more Libra, then the association will buy more of the underlying assets and create Libra. Similarly, if they wanted out of Libra, the association would pay them and destroy their share of the Libra.
Now that you know about Libra, you can be a part of it by mid-2020 and get your hands on it if you are interested. Whether you trust Facebook or not, they clearly have shaken up the crypto space with this announcement.
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