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Briefing
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- Stablecoin – Facebook formally announced Libra, stable cryptocurrency that exists on its own open-source blockchain, with value tied to real-world assets run by banks and government securities, which could include fiat currencies such as the dollar, euro, pound, Swiss franc, and yen, in June 2019
- Coalition – Cryptocurrency will be initially run by Libra Association, headquartered in Geneva, Switzerland, which will provide open source framework for blockchain governance, manage global expansion, as well as distribute social impact grants
- Partnership Dynamics – Current 28 founding members provided at least $10 million each in investment, reaching 100 members by 2020, with each member serving initially as validator node, with vote not exceeding 1% per member
- Revenue Model – Founding members including Mastercard, PayPal, eBay, and Uber will earn interest on fiat money cashed in in exchange for Libra and held as reserve, while merchants may receive percentage for each transaction processed, and wallet providers with Know-Your-Customer (KYC) and anti-fraud processes also rewarded
- Use Cases – Include cross-border remittances providing cheaper and faster way to send money abroad, payments for goods and services from merchants that accept the cryptocurrency, store-of-value for holding cryptocurrency in Facebook’s Calibra and other third-party wallets, as well as smart contracts for app development
- Functionalities – Include scalability (can handle 1,000 transactions per second), security, low latency, and high-capacity storage, with Byzantine Fault Tolerance (BFT) system as current consensus mechanism, eventually moving to permissionless Proof-of-Stake (PoS) in future
- Development Status – Libra blockchain prototype launched testnet for developers to build apps on in beta mode until public launch in 2020, pending regulatory approval
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Organization
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Facebook Inc., MasterCard Inc., PayPal Inc., Uber Technologies Inc., eBay Inc.
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