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Facebook reveals its cryptocurrency Libra

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Re: Facebook reveals its cryptocurrency Libra

#661

Post by semi-extrinsic »

mdorazio wrote: post #639
generalk wrote: post #592

Earlier quoted context omitted.

> 1. The world could use an online independent currency I'm not 100% steeped in cryptocurrency theory, and so I don't understand why this is presented as if it's agreed on by everyone. What problems does the world have that would be solved by an online, independent [of any nation, presumably?] currency? > 2. Adding stability to blockchain currencies and having > that work on a large scale is a good thing Having a blo…

I'm fairly anti-crypto, but there are a couple items in favor of #1: - A currency outside of traditional governments would theoretically be free of currency manipulation by those governments (ex. China and the Yuan) - An international currency can sidestep the artificial middleman fees and friction caused by traditional monetary exchanges. Ex. my friend who is currently studying in Japan wanted to get some money from…

> - A currency outside of traditional governments would theoretically be free of currency manipulation by those governments (ex. China and the Yuan)

As long as these three points are true: a) the notion of a stablecoin means stable relative to one selected fiat currency, b) the goods you are selling or purchasing are priced both in your local currency (which may or may not be the stablecoin peg) and the stablecoin, and c) that governments can still manipulate the ordinary currencies, then I don't see how you can be free from government manipulation.

Re: Facebook reveals its cryptocurrency Libra

#662

Post by tuesdayrain »

cwkoss wrote: post #527
tetrisgm wrote: post #22

It’s going to be interesting. “Unlike previous stablecoins, Libra will not be issued by a central party. Instead, Facebook has enlisted 27 fellow Silicon Valley titans—among them PayPal, Visa, Spotify, Mastercard, Uber, and eBay—to operate as preliminary “validator nodes” who will each share a transparent copy of a vast ledger of transactions reflecting all the activity on the network.” That sounds amazingly dystopia…

Ripple has an extremely flawed design, do your research before investing.

As someone who is currently invested in XRP, I would appreciate if you could elaborate on this flawed design instead of just posting a vague comment. I've done my research and thought the design was genius so I'm curious why you wouldn't like it.

Re: Facebook reveals its cryptocurrency Libra

#663

Post by miohtama »

jpmattia wrote: post #546

Again: A ledger that is not decentralized is a bank database, not a cryptocurrency. As near as I can tell, Zuckbucks are nothing more than the JPMorganCryptocurrency but with a bigger consortium. The only difference seems to be who is given write privileges to the database.

Libra is a attempt to cut out issuer banks, as in credit cars issuance, out of the equation. That is why Visa/PayPal/Mastercard are on the board. It is less fees for the consumers, definitely better UX, and in a sense relief from the legacy banking woes.

Re: Facebook reveals its cryptocurrency Libra

#664

Post by schmichael »

This reads a lot like the founding of the Federal Reserve:

> [The Federal Reserve] had several key components, including a central bank with a Washington-based headquarters and fifteen branches located throughout the U.S. in geographically strategic locations, and a uniform elastic currency based on gold and commercial paper.

1. Geographically dispersed

2. Value elastic but secured by assets

3. Controlled by a small group of people

4. Goal of stable long term prices

Key differences between this and the US federal reserve seem to be:

1. Libra involves no state actors

2. Libra is pay-to-play (vs representative democracy for directors of the US Fed)

3. Libra has no employment objective

4. Libra has no interest objective (outside of maintaining investment in its reserve assets)

5. Libra is "fully backed by real assets"

While personal socio-political beliefs make #1 a huge concern for me, and #2 has been widely critiqued already, #3 - the US Fed's employment objective - is an interesting difference to me.

I have not read all of the Libra material yet, but so far this belief is the only reference I've found to Libra's relationship to work:

> We believe that people have an inherent right to control the fruit of their legal labor.

Seems simple enough on the face of it. An extremist could perhaps liken it to "taxes are theft," but I don't see evidence of that in one vague sentence.

I think instead this outlines a key philosophical difference between the US Fed and the Facebook Fed:

The US Fed has an objective of (indirectly through labor) distributing capital.

The Facebook Fed has an objective of easing the flow of capital.

The Facebook Fed therefore is neutral, amoral, technocratic in its approach: make what you have easier to use.

Whereas the US fed (and I suspect other federal reserves) have a non-fiscal social component builtin: increase capital distribution through availability of labor.

Re: Facebook reveals its cryptocurrency Libra

#666

Post by tim333 »

jpmattia wrote: post #546

Again: A ledger that is not decentralized is a bank database, not a cryptocurrency. As near as I can tell, Zuckbucks are nothing more than the JPMorganCryptocurrency but with a bigger consortium. The only difference seems to be who is given write privileges to the database.

>“JPM Coin,” a digital token that will be used to instantly settle transactions between clients of its wholesale payments business.

JPM is for internal use. ZuckBucks I can transfer from my anon address to your address by signing with my private key.

Re: Facebook reveals its cryptocurrency Libra

#667

Post by thrav »

semi-extrinsic wrote: post #661
mdorazio wrote: post #639

Earlier quoted context omitted.

I'm fairly anti-crypto, but there are a couple items in favor of #1: - A currency outside of traditional governments would theoretically be free of currency manipulation by those governments (ex. China and the Yuan) - An international currency can sidestep the artificial middleman fees and friction caused by traditional monetary exchanges. Ex. my friend who is currently studying in Japan wanted to get some money from…

> - A currency outside of traditional governments would theoretically be free of currency manipulation by those governments (ex. China and the Yuan) As long as these three points are true: a) the notion of a stablecoin means stable relative to one selected fiat currency , b) the goods you are selling or purchasing are priced both in your local currency (which may or may not be the stablecoin peg) and the stablecoin,…

In the article, they mention that the price is pegged against 3 currencies (think they said: USD, JPY, EUR)

Re: Facebook reveals its cryptocurrency Libra

#668

Post by andrewla »

ilaksh wrote: post #567
jpmattia wrote: post #546

Again: A ledger that is not decentralized is a bank database, not a cryptocurrency. As near as I can tell, Zuckbucks are nothing more than the JPMorganCryptocurrency but with a bigger consortium. The only difference seems to be who is given write privileges to the database.

Correct. Libra coin is backed by Visa. The whole point of cryptocurrency to avoid having to go through middlemen like Visa or even require banks. This is a way for the intermediaries to cash in on the cryptocurrency hype and squash it before cryptocurrency payments become mainstream. They want to insert their own thing that looks like a cryptocurrency but will allow them to continue to profit from and control the exc…

> The whole point of cryptocurrency to avoid having to go through middlemen like Visa or even require banks.

"Whole point" is speaking for a whole lot of people who may not share your views. Certainly circumventing banks was an important founding concept, but circumventing _central_ banks is arguably much closer to the goal.

There's no reason why credit cards shouldn't exist denominated in Bitcoin -- they provide easy access for consumers to obtain unsecured credit. There's no reason why banks (even fractional reserve banks) shouldn't have accounts denominated in Bitcoin -- they provide an easy path for consumers to issue credit.

Opinions may vary on this, but if Bitcoin (or another decentralized cryptocurrency) succeeds the way that people want, I don't see any way to _stop_ these things from happening. People are willing to pay interest on loans; other people want to earn low-risk interest on capital.

The thing that will change is that hopefully without central banks consumers will have to realize that depositing money in banks is not risk-free. And hopefully society will learn this as well and we'll move out of the cronyism/free-money regime that we've been stuck in for the last hundred years or so.

Re: Facebook reveals its cryptocurrency Libra

#669

Post by JaRail »

mensetmanusman wrote: post #207
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 [...…

There would be savings for cross border transactions. If governments aren’t going to support banking the poor, then why does it matter who does it?

Assuming you can buy/sell it with better fees/rates. It's bound to be better than some and worse than others.

Re: Facebook reveals its cryptocurrency Libra

#670

Post by taurath »

rt2dap wrote: post #659
taurath wrote: post #652

Earlier quoted context omitted.

> I'm not 100% steeped in cryptocurrency theory, and so I don't understand why this is presented as if it's agreed on by everyone. What problems does the world have that would be solved by an online, independent [of any nation, presumably?] currency? Visa and Mastercard are taking a 3-4% cut of every single consumer payment made in much of the world. That ends up being a very, very big number. There are many people a…

Visa and Mastercard have invested so I wonder how they might weigh in on the project. Also, the Libra-coin should also have a transaction cost associated but I would expect/presume it stands an order of magnitude lower than 3-4%

Visa/Mastercard consider crypto an existential threat - the value add that they have in terms of consumer protection, middleman conflict resolution, and fraud prevention does not add up to that 2-4% level of value, and they admit that. Trust and the network effect keep them in play for now.

https://qz.com/1646097/what-does-facebooks-crypto-coin-libra...

Crypto transactions however, have not lived up to the "hype" of being truly cheap thus far. Visa/MC are positioning themselves such that the value they bring is not something that crypto can provide. We'll see where that ends up - I'd expect Visa/MC stock to move a bit if the transaction fees for Libra end up being sub-$.05.

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