Libra facebook coin launch date
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- Diem Coin: What You Need To Know
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- What is diem? New digital currency to launch from Coinbase, Facebook and Uber
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- Facebook announces Libra cryptocurrency: All you need to know
- Facebook plans to launch own cryptocurrency called Libra
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- Facebook's New Libra Coin: How Does It Work, and Should You Buy It?
Diem Coin: What You Need To Know
Intereconomics on Twitter. A service of the ZBW. Libra — a global virtual currency project initiated by Facebook — has been the subject of many controversial discussions since its announcement in June This paper provides a differentiated view on Libra, recognising that different development scenarios of Libra are conceivable.
Libra could serve purely as an alternative payment system in combination with a dedicated payment token, the Libra coin. Alternatively, the Libra project could develop into a broader financial infrastructure for advanced financial services such as savings and loan products operating on the Libra Blockchain. Based on a comparison of the Libra architecture with other cryptocurrencies, the opportunities and challenges for the development of the respective Libra ecosystems are investigated from a commercial, regulatory and monetary policy perspective.
The grand vision of Facebook and the other founding members is to empower billions of people in emerging economies who very often have no access to banking or other financial services. Libra will develop a new ecosystem that enables worldwide monetary transactions in a stable digital currency at close to zero marginal costs. This could — so the line of argument — foster financial inclusion by providing better access to financial services and capital, especially in less developed countries.
At the same time, the Libra project aims to enable huge efficiency gains in developed economies, which would trigger additional economic growth globally. The envisaged launch date of Libra is early ; the current state of the technical and conceptual framework development is documented in the Libra White Paper 1 and additional technical documents. Since the announcement, there have been many voices from representatives of central banks and regulatory authorities raising concerns about potential risks of the Libra project.
Depending on other financial services it offers, Libra could be subject to additional regulatory requirements. It currently remains unclear what development trajectory the Libra project will ultimately pursue. The long-term strategy of Libra has not yet been communicated. Multiple scenarios are plausible depending on the future design of the Libra project and the corresponding response of regulatory and supervisory authorities.
Therefore, it seems worthwhile to take a closer look at this project in order to improve the basic understanding of the economic logic behind this endeavour and point out associated opportunities and risks for the financial sector.
This begins with an analysis of the key elements of the Libra project, including the basic architecture, i. A brief comparison of Libra with Bitcoin, Ethereum and selected stablecoins is also provided. Subsequently, the Libra project is discussed along its potential development lines, which can be summarised as follows: First, Libra could serve purely as an alternative payment system in combination with a dedicated payment token, the Libra coin.
Second, the Libra project could develop into a broader financial infrastructure enabling advanced financial services such as savings and loan products provided on the Libra Blockchain. Finally, the question must be addressed as to whether and to what extent Libra could interfere with monetary policy actions in fiat currencies, e. Any discussion of these aspects can only be preliminary, given the early stage of the Libra project. Figure 1 illustrates the core components of the envisaged Libra architecture.
The governing body is a non-profit organisation the Libra Association based in Geneva, founded according to Swiss law. The Libra Association exhibits a heterogeneous membership base, including technology firms e.
Vodafone , blockchain companies Coinbase, Anchorage , Venture Capitalists and non-profit-organisations. All founding members have invested at least 10 million dollars and are acting as validators on the blockchain. The Libra Association develops and operates the Libra Blockchain and manages the reserves that are designed to back any issuance of Libra coins, thereby ensuring that, in contrast to other popular cryptocurrencies, the Libra coin is equipped with an intrinsic value.
As only bank deposits and short-term government bonds in stable currencies are eligible for Libra reserves, the Libra coin is expected to become a stablecoin itself. A stablecoin is a special form of cryptocurrency as its value is derived from the value of a single asset e. The reserve is the key instrument for preserving value, as each Libra coin will be fully backed by a diversified basket of low-volatility and liquid assets such as short-term government bonds and deposits in stable fiat currencies like the US dollar, the euro, the British pound and the Japanese yen.
The composition of deposits and government securities from low-inflation countries shall limit the volatility of the calculated Libra price expressed in a given fiat currency. The design of the Libra system is expected to contribute to the credibility of the Libra coin as a unit of account, a stable medium of exchange and finally as a store of value. Hence, Libra shall fulfil the basic functions of money.
Users will not have any direct access to the Libra reserve but will have to purchase and sell Libra coins through authorised resellers so that new coins are minted when demand increases and destroyed when demand contracts.
Authorised resellers may include regulated electronic exchanges, cryptocurrency platforms or financial institutions. A blockchain is a form of distributed ledger that allows transactions to be executed quickly and securely by using cryptographic technologies in combination with an algorithm ensuring consensus among the nodes of the network as to the validity of the transaction. Such systems continuously update and check themselves by using intelligent execution verification algorithms in order to reach consensus on the respective status of the database in which all transactions are recorded.
Maintaining the integrity of the system by preventing double spending of monetary units, manipulation attacks from outside the system or theft of private keys are common challenges of distributed ledger systems.
Nevertheless, the Libra Blockchain is designed as an open source system that allows developers and users to build their own products and services on the blockchain.
The scalability of the system in terms of processing capacity is a problem all blockchain solutions have to solve in case of growing demand for computational power or high volatility of capacity utilisation.
The Libra project intends to apply a concept similar to the one introduced by Ethereum. Therefore, the price sensitivity of users has an impact on the timing and speed of transactions. However, the Libra system is expected to only charge very low fees during periods of normal transaction density, while the fee-based mechanism is designed to help allocate system capacity according to user price sensitivity during peak periods. Rising fees will mitigate high demand for transactions and help to shift them to off-peak periods when fees are lower.
Transaction execution on the Libra Blockchain ensures that no Libra coin will be duplicated, lost or transferred without authorisation. In distributed computer networks, an algorithm-based consensus mechanism ensures that an agreement on the correct state of the ledger among nodes is achieved and shared throughout the network.
The most common consensus mechanism is the proof-of-work POW concept applied by Bitcoin and other cryptocurrencies such as Ethereum. POW relies on the solution of a mathematical problem, upon which the successful miner is rewarded with a specific number of cryptocurrency units. The POW consensus mechanism requires new transactions to be broadcast to all nodes of the network.
Each node collects new transactions into a block and works on finding a cryptographic hash value for the respective block that fulfils certain requirements, i. As the blocks are linked together to form an ever growing blockchain, solving such a problem requires an increasing number of iterations and hence greater CPU power and electricity over time.
After a node has solved the hash problem and thus fulfilled the proof-of-work condition, the block is broadcast to the whole network, whereby the nodes check the validity of the new block and the transactions contained therein.
Nodes express their acceptance of the block by working on creating the next block in the chain, using the hash of the accepted block as the previous hash. The mining reward on the Bitcoin blockchain is currently set at The generation and acceptance of a new block currently takes about ten minutes on average.
The structural disadvantage of the POW approach is its lack of scalability, as demand for CPU time and energy increases with the size of the blockchain. There is also the risk of concentrating mining capacity over time, as large mining pools benefit from economies of scale and cheaper access to electricity supply. For this reason, the proof-of-stake POS approach is posited as an interesting alternative that avoids the cost- and energy-intensive mining process, as the validator of a block is selected based on its economic stake in the network.
Hence the creator of the next block may be selected according to the size or age of its deposit, usually in combination with a random component. The selected validator must then verify all transactions contained in the block, which involves checking that it was signed with the correct private key and auditing the entire history of the wallet to prevent double spending.
Finally, the validator is rewarded with the fees associated with every transaction contained in the block. Ethereum also intends to switch from POW to a POS consensus mechanism in the foreseeable future to overcome scalability issues and foster growth of its platform.
Table 1 gives a brief overview of the major commonalities and distinctions between the Libra concept, on the one hand, and Bitcoin, Ether and other stablecoins on the other.
Visa has been included in the table to allow for a direct comparison with the current largest payment infrastructure in the credit card business, which operates with a centralised database rather than some kind of distributed ledger.
Bitcoin is by far the largest virtual currency platform in terms of market capitalisation, though it remains far behind the Visa Group even more than ten years after its introduction. This could be different in the case of Libra, as Facebook currently has some 2. In terms of supporting smart contracts, Ethereum has become the most popular blockchain, whereas Bitcoin was designed first and foremost as a digital currency platform.
Although smart contracts can also theoretically be implemented on the Bitcoin blockchain, the functionalities and programme design of Ethereum and other blockchains such as Ripple prove to be more suitable in that regard. Source : Own estimates, company information, coinmarketcap. Libra is designed as a stablecoin, with each Libra being covered by Libra reserves.
Stablecoins have so far been backed by various types of assets, including commodities, fiat money and other cryptocurrencies. Prominent examples, although still negligible in terms of a market cap, include the gold-backed Digix token and the US dollar-backed Tether.
Libra pursues a different strategy, as it intends to build a diversified Libra reserve comprised of bank deposits and short-term bonds denominated in low-inflation fiat currencies. In essence, the Libra concept primarily differs from existing virtual currencies and stablecoins in the design of the Libra reserve, the presumably faster and more cost-efficient design of the Libra Blockchain yet to be proven and finally by the potentially large global user base to be recruited from the Facebook platform and other payment solution providers.
In order to analyse the potential opportunities, risks and possible regulatory concerns, one needs to take into account the potential fields of application. Therefore, we look briefly into the need for a new and more global medium of exchange — proclaimed by the Libra initiators — that will bring global payment systems to a new level and enhance financial inclusion in emerging economies.
The efficiency of payment systems in developed countries has advanced so far over the last ten years that real-time transactions without the use of distributed ledger technologies DLT will become standard in the foreseeable future for business-to-business but also for business-to-consumer or consumer-to-consumer transactions.
Alternative payment systems such as PayPal, Apple Pay or AliPay cannot be classified as real-time payment systems at this stage, as users receive immediate notification of the transaction, but funds are usually transferred on the next business day. The situation is very different for cross-border payments to or between emerging economies.
Global remittances reached billion US dollars in and are projected to grow further, as they are an important financial resource in developing countries. MTOs have been subject to severe criticism in the past with regard to the lack of transparency and traceability of transfers as well as insufficient know-your-customer KYC and anti-money-laundering AML procedures.
DLT could therefore be a cost-efficient alternative and also improve regulatory compliance in the international payment sector. Libra might therefore tap this unexploited market potential with its new Libra platform. However, it currently remains unclear whether DLT-based technical solutions will be superior to ongoing initiatives aiming to introduce real-time cross-border payment solutions e. SWIFT gpi. Demand for Libra could soar due to low transaction costs and the network effects associated with the growing use of Libra among Facebook users.
A key prerequisite for an accelerated diffusion of Libra would be a high degree of credibility and trust in the stability of the Libra coin, which the founders intend to achieve through a number of instruments such as the Libra reserve, the involvement of global payment service providers and finally the proactive approach of becoming a regulated financial services provider.
This is intended to apply both to Libra as a payment services infrastructure — regulated by Swiss law — and the respective financial services offered on the Libra Blockchain. Therefore, Calibra, a subsidiary of Facebook offering a Libra wallet, has been registered with the U. Financial Crimes Enforcement Network as a money services business. However, this is just the beginning of an extensive process of applying for licenses needed for specific service offerings and subsequent supervision of the competent authorities in question.
For instance, Calibra will most likely need to obtain additional money transmission licenses in each of the US states it operates in. Furthermore, depending on the type and scope of other financial services offered, Calibra or other users of the Libra Blockchain will need to meet relevant legal requirements such as banking regulations.
Provided that Facebook, together with its co-initiators, manages to market the benefits of Libra successfully through its global user base, and assuming that Libra limits itself to the function of a regulated payment platform, demand for Libra coins could grow very rapidly and eventually exceed the geographic reach of the US dollar or the eurozone. In fact, Libra could advance to a kind of parallel digital currency used at least partially alongside the respective national fiat currency.
As long as the Libra coin is only a unit of account in a clearly defined although very large multilateral payment network of Libra users, such a payment infrastructure could promote financial inclusion and increase global payment efficiency.
Libra - One coin to rule them all?
Finance is a key sector for the economy. Therefore, any significant innovation in this field deserves to be analysed with caution, and its implications, well understood. This is what we seek to do in this article with the Libra project. In addition to the considerations above, the size and scope of Facebook imply that Libra has the potential to become systemic.
What is diem? New digital currency to launch from Coinbase, Facebook and Uber
This future is a lot closer than you think — just a few months away. Then, a new player will emerge and try to change the game. Considering there are more than 2. Facebook joined forces with 27 organizations to introduce the new cryptocurrency to the world in One of their objectives is to make it a new medium of payment for everyone, including the 1. Only time will tell, but this article will shine some light on the new Facebook cryptocurrency and its inner workings, so you can form an opinion about it. Mark Zuckerberg wants to make financial transactions as easy as sending a message or a picture. He summarized what the upcoming Facebook crypto is about in a post on Facebook. This is the highlight of his words:. Its creators intend to build a bridge to connect Cryptocurrency Land to the Fiat Money kingdom.
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Digital payments is a space with a lot of opportunities. As more and more people are getting access to the Internet through cheaper smartphones, much of the economic activity is happening online. Companies like Paypal, Visa, and MasterCard are already catering to a lot of this activity. In addition, many projects in the crypto space are also trying to build products for this sector. Unlike other projects, however, Facebook already has a large user base.
Facebook announces Libra cryptocurrency: All you need to know
According to people involved in the initiative, the launch will be in an even more limited format than its already downgraded vision. The exact launch date would, however, depend on when the project receives approval to operate as a payment service from the Swiss Financial Market Supervisory Authority. But sources say it could come as early as January The impending launch of the Libra could significantly sway the crypto ecosystem as the coalition of the Facebook-led Libra group pulls huge traction across the world. Other cryptocurrencies such as Ethereum and Ripple also responded positively. However, Coindesk reported that the Libra had no significant effect as Bitcoin trade was flat in the four hours that followed the release of the white paper.
Facebook plans to launch own cryptocurrency called Libra
For blockchain investors who want all the technical information read the latest version of the white paper here. Despite the recent push for people to delete their Facebook accounts due to privacy concerns they still have millions of users every day. Libra was originally planned as a stablecoin pegged to the value of several different currencies. Read our top-rated piece on stablecoins here. Initially, however, Diem is likely to be backed one-for-one by the US dollar, as they try to meet worldwide government regulatory approval. Over 50 engineers are working on the project, which is highly confidential, requiring special keycard access to enter the building. The current Diem association members.
Facebook’s embattled cryptocurrency project is likely coming to an end
Facebook plans to launch own cryptocurrency called Libra. The Moroccan royal palace says a 5-year-old boy who was trapped in a deep well for four days has died. Keep up to date with ABC Emergency.
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In June of the development of a new cryptocurrency, Libra, was announced. Will lawmakers or other stakeholders prevent it from reaching the marketplace? Is it even accurate to call it a cryptocurrency? Fully customizable and easy to set up, get started today!
VentureBeat Homepage. Join today's leading executives online at the Data Summit on March 9th. Register here. The news captured international media attention and has dominated headlines for more than two weeks since the official announcement. This end-to-end encryption makes transactions highly secure nigh unbreakable and irreversible. These transactions are recorded on what is called the blockchain. Only 21 million bitcoin will ever exist, and the currency is as impractical to police or ban as the internet.
Facebook claims it wants to reach people without access to a bank account, and that Libra is the best way. The new technology threatens to change the landscape of banking and is already the subject of scrutiny, as Facebook faces increasing calls for regulation and antitrust measures. In other words, it is a digital asset built by Facebook and powered by a new Facebook-created version of blockchain, the encrypted technology used by bitcoin and other cryptocurrencies.