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Facebook reveals its cryptocurrency Libra

decrypt.co

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Re: Facebook reveals its cryptocurrency Libra

#451

Post by supermatt »

kobasa wrote: post #442
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.

They aren't minting their own money out of thin air - it's fully backed by existing currencies like the Dollar/Euro/Yen/Pound. They're just making it easy to send this across borders digitally.

You say its "backed", but what stops them minting more libra than they have "backing" for? Nobody would know any different unless every user attempted to remove all their funds at once. How can you be sure that this wont happen? This is EXACTLY like a bank, but without any of the regulatory protections.

Re: Facebook reveals its cryptocurrency Libra

#452

Post by hobofan »

swordsmith wrote: post #402
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.

> I'm pretty sure that this type of data collection tool is in use today by the Chinese government. Yeah US is a bit slow to that party. Alipay and Wechat-pay has roughly a billion users (conservative estimate) in China. It's widely socially accepted. Makes more sense in the case of China, which never had wide adoption of credit cards. In Libra's case...why should I ever use it instead of sticking with credit cards?

> In Libra's case...why should I ever use it instead of sticking with credit cards?

Given that both VISA and Mastercard are on board, I assume that you might not have a choice in the long run.

Re: Facebook reveals its cryptocurrency Libra

#453

Post by espadrine »

renaudg wrote: post #260
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…

There is at least this from Zuckerberg's announcement : "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."

Facebook’s promises are as trustworthy as their record of not breaking them.

They promised not linking accounts between WhatsApp and Facebook, inevitably broke it, and faced triple-digit millions in fines, without a sweat: https://www.theverge.com/2017/5/18/15657158/facebook-whatsap...

Re: Facebook reveals its cryptocurrency Libra

#454

Post by tim333 »

From the technical paper it seems to be able to be transferred anonymously like bitcoin etc

>To create a new account, a user first generates a fresh verification/signature key-pair

>The Libra protocol does not link accounts to a real-world identity. A user is free to create multiple accounts by generating multiple key-pairs. Accounts controlled by the same user have no inherent link to each other. This scheme follows the example of Bitcoin and Ethereum in that it provides pseudonymity for users. https://developers.libra.org/docs/assets/papers/the-libra-bl...

I'm wondering if this may create legal problems for Facebook and its partners when the currency gets used for illegal stuff. Bitcoin doesn't get sued when it's used for drug dealing because there is no one to sue.

Re: Facebook reveals its cryptocurrency Libra

#455

Post by justusthane »

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 [...…

Not disagreeing with the sentiment of your comment, but the article does say "Facebook, and its partners—two dozen so-called “validators” that will run the proprietary blockchain network—will govern a reserve of users’ funds, on which they will be able to accrue interest."

Re: Facebook reveals its cryptocurrency Libra

#456

Post by mertd »

asaph wrote: post #239

> The aim, then, is to get to 100 new validators by 2020, and achieve something close to 1,000 transactions a second—roughly 200 times the sum Bitcoin can currently handle, and around half the capacity of Visa. My reactions to the above: 1. 1000 transactions per second seems low. This doesn't feel very scalable to me. 2. Visa has capacity to handle only around 2000 transactions per second? I would have assumed it was…

Usually in these comparisons Visa/MC TPS figures are averages whereas crypto TPS are peak. Big difference.

Re: Facebook reveals its cryptocurrency Libra

#458

Post by supermatt »

justusthane wrote: post #455
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 [...…

Not disagreeing with the sentiment of your comment, but the article does say "Facebook, and its partners—two dozen so-called “validators” that will run the proprietary blockchain network—will govern a reserve of users’ funds, on which they will be able to accrue interest ."

The partners accrue interest - not the users.

Re: Facebook reveals its cryptocurrency Libra

#459

Post by jlmorton »

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 [...…

This is not a bank. It's an asset and a payment network. Banks are organizations that borrow short to lend long. This is a stablecoin backed very closely 1:1 with fiat currency. There is no fractional reserve, and there is no lending.

Re: Facebook reveals its cryptocurrency Libra

#460

Post by supermatt »

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.

This doesn't follow the same rules as other cryptocurrencies though - its proof of stake, where a select number of parties can mint their own "funds"
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