What is Libra?
There is relatively a lot to unpack here, and while I would love to get into the details of what the launch of Libra means, let’s keep it to the points, and unpack (if we can), on later posts.
According to Mark Zuckerberg, CEO at Facebook:
“Facebook is coming together with 27 organizations around the world to start the non-profit Libra Association and create a new currency called Libra.
Libra’s mission is to create a simple global financial infrastructure that empowers billions of people around the world. It’s powered by blockchain technology and the plan is to launch it in 2020.”
We’ve been hearing rumors about Facebook’s new crypto-currency for months now, with hints of what it may entail, but this is the first official announcement of the platform. Zuckerberg continued to mention Facebook’s renewed emphasis on Privacy and Security, specifically with regard to Libra, and a future standalone messaging app; Calibra, which seems to want to meld features of Facebook Messanger and WhatsApp, while also being an e-wallet. (Zuckerberg never called is a crypto-currency by the by).
What is the Libra Ecosystem?
There’s a bit more understanding of blockchain technology needed when we’re looking at Libra, but this video from Facebook gives everything to us in a nutshell:
What is Calibra and the Libra Ecosystem?
In a nutshell, it seems that Calibra will be the mobile application that lets you engage with the Libra currency or coin. Letting you, much like Snapscan, make payments, send money, like MPESA and so on, but using Libra.
According to Zuckerberg: “Calibra will be regulated like other payment service providers. Any information you share with Calibra will be kept separate from information you share on Facebook. From the beginning, Calibra will let you send Libra to almost anyone with a smartphone at low to no cost. Over time, we hope to offer more services for people and businesses — like paying bills with the push of a button, buying coffee with the scan of a code, or riding local public transit without needing to carry cash or a metro pass.”
What is the Libra Association:
The Libra Association itself is a collection of financial companies like: “Mastercard, PayPal, PayU, Stripe and Visa, to popular services like Booking, eBay, Farfetch, Lyft, Spotify and Uber, to non-profits doing important work around financial inclusion like Kiva, Mercy Corps and Women’s World Banking, to companies in the crypto space like Anchorage, Coinbase, Xapo, and Bison Trails.”
This Association will act, it seems, as custodians of the Libra financial book, they’ll even be called the Libra Association Council, each member in the association will also hold a node, to ensure the initial blockchain functions.
Before you think (like me), that this sounds like just a bunch of rich people managing the world’s money again, there is a mention that nodes can be opened by anyone that meets the technical requirements, therefore, limiting the strength of the initial node holders in the association. (in a very summarised way).
More details on the nature of each partnership are sure to follow in the coming months, but it makes sense for Facebook to collaborate with each of the biggest entities into building out, what looks to be, a revolution in financial inclusion.
Global Financial Inclusion:
Facebook has changed the way we engage on the internet. For better or worse, the world will never be the same.
The announcement of Libra, and it’s connected wheel spokes, is another step in the rhythm of how Facebook approaches the world: disruptively.
I do think that because of their more recent public blow ups on privacy and security, this new platform and system, will disrupt, but with a more experienced and mature touch.
The idea of Libra isn’t new, but with more backers, partners and minds at the table, I see no reason why Facebook’s investment wouldn’t be successful and quickly beat out the seasoned competition. Especially in an African or Asian region where users are Mobile First, or Mobile only orientated, and rely on devices for daily financial management more than paper.
Libra’s mission is simple, yet, aspirational, but also generic:
A simple global currency and financial infrastructure that empowers billions of people.
Personally, I’m looking forward to seeing what Libra brings to the world, it’s financial institutions, businesses, and yes, the average consumer, who will be using these services every day. Let me know what you think in the comments, would love to chat and get a better perspective.