With Libra, a new global digital currency, Facebook enters the cryptocurrency and payments space through a new subsidiary called Calibra. Libra is a low-volatility currency or a so-called stablecoin.
Among the backers of Libra are Visa, Mastercard, PayPal, Booking.com, Uber, Stripe and Iliad.
The first product Calibra intends to release is a digital wallet for Libra that’s also called Calibra. It will be available in Messenger, WhatsApp and as a standalone app, and is expected to launch in 2020. Libra is the name of the currency and of the underlying blockchain network (Libra Blockchain) and association of partners (Libra Association).
The Facebook Libra project started several years ago as did plans at Facebook to see what it could do with blockchain technology. On June 18, 2019, Facebook unveiled details about the Libra digital currency, the blockchain powering it, the roadmap ahead, the ecosystem, technological details (such as the programming language for the Libra Blockchain, Move) and so forth. Facebook calls Libra “a simple global currency and financial infrastructure that empowers billions of people” – and that starts with the few billion users the company has. An overview.
Calibra headed by David Marcus
The Libra Association is based in Geneva, as is Calibra that is headed by David Marcus.
On top of having spent two years at the University of Geneva, the city where Paris-born Marcus grew up and founded his first company, GTN Telecom, Marcus was three years at PayPal (VP/GM Mobile and, later President), served on the board of directors of Coinbase and is with Facebook where he first worked as VP Messaging Products.
PayPal also plays along as a founding member. When talking about messaging apps, the platforms that seem to be the primary target for the project – or environment for its users and some countries that might be in the early launch – also think about mobile companies by the way. Vodafone is one of the other founding members.
David Marcus’ new title is Head of Calibra, Facebook. Marcus states that Libra holds the potential to provide billions of people around the world with access to a more inclusive, more open financial ecosystem. However, as other founding members emphasize too it’s just the beginning – and a lot can still happen. Marcus: “We know the journey is just beginning, but together we can achieve Libra’s mission to create a simple global currency and financial infrastructure that will empower billions of people”.
The Libra Association: role and members
The Geneva-based Libra Association is set up as an independent non-profit. It consists of Facebook and the various backers who each maintain a node on the network, essentially verifying and recording transactions.
As a reminder: blockchains are managed by nodes (servers) to reach consensus about the order of new transactions on the blockchain and create a record of transactions, together forming the network and distributed ledger that can be used to develop other services.
So, each organization in the Libra Association (paying $10 Million, except non-profit partners that pay less) maintain a node. Moreover, every backer has a representative to serve on the Libra Association Council that takes care of (decisions regarding) the operation of the Libra Blockchain, the expansion and further development of the network and the management of the Libra reserve that aims to keep its value stable (stablecoin).
All founding members have 1 vote or 1% of all votes (whichever is greater) to avoid that one of them gains too much control. Facebook, however, has two votes. Eventually the association aims to create a permissionless network and open and accessible blockchain when anyone meeting the technical requirements can operate a validator node.
The backers (paying to be nodes) among others include Visa, Mastercard, PayPal, Booking.com, Uber, Stripe, Andreessen Horowitz, Coinbase, Vodafone, Spotify, Kiva, Creative Destruction Labs, Mercy Corps, Women’s World Banking, Union Square Ventures and Iliad, a French telecommunications company, among others behind mobile operator Free Mobile and founded by French billionaire Xavier Niel who also is co-owner of French newspaper Le Monde.
In total, Facebook hopes to sign up a total of 100 organizations investing the money to become a Libra network node, thus raising a reserve of 1 billion USD.
All details on https://libra.org
More on Facebook GlobalCoin/Libra once those official details emerge. Top image: Shutterstock – Copyright: TY Lim – All other images are the property of their respective mentioned owners.