Crypto 360°: Credit where credit is due: Facebook's Libra

Sunday, 7 July 2019

Credit where credit is due: Facebook's Libra

Hello Everyone,

Facebook’s Libra coin has a lot of benefits and it’s important to recognise them. When steps are made in the right direction it should be celebrated.

Why is Facebook’s Libra a step in the right direction?

There are billions of people around the world who don’t have access to financial infrastructure, let alone sound money.

When considering this keep in mind, if you are in a developed (typically western) country you have never faced the issues of rampant deflation or an inability to access financial infrastructure (in recent memory).

Facebook is going to make a basket of stable, usable, widely accepted currency available to 2.3 billion people. This is a truly amazing feat. They will, almost overnight, give the option for whole nations of people access to the standard of financial infrastructure many of us take for granted.

Borderless, fast, secure and stable money is going to help an incredible amount of people. I remember when this was touted as almost the paramount goal of Bitcoin. (Although I do consider its paramount goal to be an exit option from the financial system).

This is great for decentralised currencies.

This is not a direct competitor to the decentralised currencies we have grown to love. Facebook is tied to fiat, therefore it is tied to traditional systems, systems designed for financial stability not systemic stability. A great article explaining this was done by Caitlin Long (1).

What Facebook’s coin will do is give validity to the cryptocurrency systems and security, whilst also identifying key concerns that are already being addressed in decentralised cryptocurrencies.

Consider what we hear about Facebook’s Libra project being “bad”: federated control, tied to fiat currencies, privacy concerns over facebook, government’s ability to control, etc… All of these issues are being tackled in the decentralised space. It’s incredible that ‘mainstream’ personalities are now talking about cryptocurrency and how to make it better. Sure they might not realise that solutions to these problems exist, are being addressed and continuously developed, but they are now considering and thinking about. Amazing.

In closing:

Facebooks coin brings a lot of the benefits of cryptocurrencies to the real world and will have a large and positive impact; borderless, fast, stable and secure currency available for 2.3 billion people. Regardless of motives, they are proving, on the world stage, the power of cryptocurrencies. This is a step in the right direction, this will help a lot of people who need a better option and at the same time highlight that its areas of concern are being addressed in the form of decentralised currencies.

Tldr; Facebook’s coin makes fast, borderless, stable currency available to those who need it, whilst highlighting the importance of decentralised cryptocurrencies.