Facebook reveals its cryptocurrency Libra • Hacker News Board

Re: Facebook reveals its cryptocurrency Libra

#421

Post by la_barba » Tue, Jun 18, 2019, 4:04 PM UTC

fnoof wrote: post #195

From the white paper: > "Libra’s mission is to enable a simple global currency and financial infrastructure that empowers billions of people." They do this by issuing coins in exchange for fiat money, which is held by the reserve. > "Interest on the reserve assets will be used to cover the costs of the system, ensure low transaction fees, pay dividends to investors who provided capital to jumpstart the ecosystem [...…

>Conceptually this is a bank, but with no interest returned to users, no financial oversight from governments, controlled by Silicon Valley's top companies.

How so? I don't think they have access to your digital wallet, unlike a bank.

Re: Facebook reveals its cryptocurrency Libra

#422

Post by rolltiide » Tue, Jun 18, 2019, 4:06 PM UTC

giaour wrote: post #312

Is there some legal shield that prevents regulators from simply saying that Libra is a bank and therefore subject to regulation as such?

No, not really. In various economic regions there can be regulators that rule this way but they won't be able to stop the commerce from happening with this currency. The Libra Foundation can also just register banks in local jurisdictions to check a box. Many incumbent services have done this for decades, like Paypal.

Cryptocurrency removes the ability of the state to whitelist transactions, as their power only existed from being able to regulate an intermediary. This is the anti-fragile nature of cryptocurrency.

Facebook's validator nodes (corporate consortiums) are a compromise on the anti-fragile nature, but not by much.

Re: Facebook reveals its cryptocurrency Libra

#423

Post by driverdan » Tue, Jun 18, 2019, 4:06 PM UTC

la_barba wrote: post #421

fnoof wrote: post #195

From the white paper: > "Libra’s mission is to enable a simple global currency and financial infrastructure that empowers billions of people." They do this by issuing coins in exchange for fiat money, which is held by the reserve. > "Interest on the reserve assets will be used to cover the costs of the system, ensure low transaction fees, pay dividends to investors who provided capital to jumpstart the ecosystem [...…

>Conceptually this is a bank, but with no interest returned to users, no financial oversight from governments, controlled by Silicon Valley's top companies. How so? I don't think they have access to your digital wallet, unlike a bank.

It's funded by you depositing fiat currency with them, like a bank. They earn interest on your deposits, like a bank.

Re: Facebook reveals its cryptocurrency Libra

#424

Post by tim333 » Tue, Jun 18, 2019, 4:06 PM UTC

hjk05 wrote: post #100

sins wrote: post #67

Earlier quoted context omitted.

Could you elaborate on what Bitcoin failed at?

I tried to buy a cup of coffee recently at a bitcoin only cafe. Though I didn’t end up paying with bitcoin because it took a day for the bitcoin atm deposit to clear. So I asked a friend who worked in the building to spot me a cup of coffee, and he paid... by making a line on a piece of paper they used to do bookkeeping denoted in fiat because no-one wanted to go through the hassle of bitcoin transfers and no one had…

You can use the bitcoin lightning network like this https://www.youtube.com/watch?v=39KpscRXyXY

Re: Facebook reveals its cryptocurrency Libra

#425

Post by wuliwong » Tue, Jun 18, 2019, 4:06 PM UTC

supermatt wrote: post #378

So facebook (and partners) can mint their own money. Are we supposed to be OK with that? Wasn't this issue one of the primary reasons for crypto currency existing in the first place. This shouldn't be allowed to exist.

In the US, cryptocurrencies are treated as assets, they are taxed every time you exchange them for something or even each other. I would disagree that libra coin is akin to Facebook and partners creating their own money.

Re: Facebook reveals its cryptocurrency Libra

#426

Post by pjmorris » Tue, Jun 18, 2019, 4:07 PM UTC

jayd16 wrote: post #420

moosey wrote: post #233

If this succeeds, it will be a data collection tool the likes of which the world has never seen, which is why so many companies are willing to put their name on it. The data, along with ML/AI, and our contemporary understanding of the human mind, means that this is a major step towards control that we can't understand. Dr. Harari explains it better than I do in "21 Lessons for the 21st Century", but this tool is part…

>the world has never seen Credit cards already have similar data, no?

No. The credit card is limited to locations where it can be swiped. The phone is online everywhere, all the time.

Re: Facebook reveals its cryptocurrency Libra

#427

Post by tzm » Tue, Jun 18, 2019, 4:08 PM UTC

ethanklitz wrote: post #392

avoutthere wrote: post #285

Earlier quoted context omitted.

> If this succeeds, it will be a data collection tool the likes of which the world has never seen I'm pretty sure that this type of data collection tool is in use today by the Chinese government.

VISA and other payment processors already collect and sell this data.

VISA's transaction data is not the same as Facebook's social data. Combining the two is the point of concern. We have financial regulatory laws for this reason

Re: Facebook reveals its cryptocurrency Libra

#428

Post by wuliwong » Tue, Jun 18, 2019, 4:09 PM UTC

DenisM wrote: post #234

gridlockd wrote: post #225

Earlier quoted context omitted.

> Conceptually this is a bank, but with no interest returned to users, no financial oversight from governments, controlled by Silicon Valley's top companies. I disagree that this is "conceptually" a bank. Facebook's business model isn't lending out the reserves. If it was, banking regulation would apply. Also, in a modern bank, reserves are maybe 10%, and you get less than zero percent interest after inflation for th…

> We've all seen in the past on how well "financial oversight" worked It worked remarkably well - no consumer lost their deposits to a bank failure. The fact that banks lent out too much money had no impact on consumer deposits, thanks to oversight.

What if banks tend to lend out too much money because of the deposit insurance? This could have other, unintended consequences beyond the narrow scope of your comment.

Re: Facebook reveals its cryptocurrency Libra

#429

Post by skeptical-cat » Tue, Jun 18, 2019, 4:09 PM UTC

Lots of people here saying this won't be adopted... I think we're all underestimating how many people are on FB. Ad targeting is very sophisticated for FB platforms, I think a "buy with Libra" button would get clicked a lot.

Which is frightening.

Re: Facebook reveals its cryptocurrency Libra

#430

Post by dragonwriter » Tue, Jun 18, 2019, 4:11 PM UTC

staplers wrote: post #416

mountainofdeath wrote: post #390

It's amazing how short of a memory people have. The financial system has at least a few centuries of experience and todays regulatory climate is a reflection of the lessons learned. To some, these rules may seem arbitrary and they sometimes are but people forget how things before. I find it amusing that the big selling point behind the initial round of cryptocurrency was its lack of regulation.

its lack of regulation. This is false actually. Cryptocurrency's "selling point" is being regulated by mathematical rules and not by potentially-corrupted policymakers.

> Cryptocurrency's "selling point" is being regulated by mathematical rules and not by potentially-corrupted policymakers.

But this is generally false; like fiat currency managed by the governments of capitalist democracies, cryptocurrencies tend to be regulated by technical experts implementing policy on behalf of th user community in which power is weighted by, roughly speaking, the product of wealth and interest in influencing policy.

For the “selling point”, the software embodying the mathematical rules regulating the cryptocurrency would need to be fixed for all time.