Is it really a cryptocurrency when it's completely centralized? No. This is just Facebook-bucks. Store dollars. It's has absolutely none of the benefits of a real cryptocurrency.
Everyone here is debating is it crypot or not... but does it matter? it's Facebook after all, we are (the typical techy user) not the target audience.<p>Unfortunately, it's going to sell just because it's the big old facebook, your non-techy friend probably don't know the difference between crypto and food stamps all they know it's points for money, one is a boring piece of paper and the other is cool futuristic out of the matrix Bitcoin like super numbers
So a cryptocurrency that is more currency than crypto? Again, back to the argument that the market is the same as in-game currency, store gift cards, Chuck-E-Cheese tokens, etc.<p>Let's be honest, most of the hype around cryptocurrency is for speculation and not as a legitimate means of exchange. Normal money works fine for means-of-exchange barring a few exceptions e.g. capital flight, money laundering, generally escaping regulation so the only value left is hype.
My speculative take:<p>Facebook’s main product has likely peaked, in terms of users and advertising unit economics. The brand is tarnished, it’s not cool for younger people, its value proposition has been heavily eroded by short sighted decisions.<p>Instagram is doing really well, but by its nature is no substitute for Facebook. It’s too specialised, too narrow a demographic, and doesn’t have the same appeal all round. It can’t pick up the slack from a declining Facebook.<p>There are real regulatory dangers that Instagram etc will be separated off anyhows.<p>This is a bet on something that could be big. I’d bet against it working out, but a series of bets like this are probably the best strategy to hedge against decline. We know payments dovetails well with messaging apps (hence perhaps the attempt to unify them, conveniently making it more difficult to break up the company). Payments is a no brainer, the “crypto” spin original but probably irrelevant. For Facebook it does have the advantage of enabling them to accumulate a large fund of “deposits” they can invest.<p>If the above is right, we should see a few other big bets being placed soon.
If Facebook can pull this off they will have brought about the first universal internet currency, which would be a stunning achievement and could revolutionalize the web as we know it. Failed projects give us some idea of what their challenges will be.<p>Cryptocurrencies right now have a trade off between scalability and decentralization. Bitcoin is theoretically decentralized even though the reality is more complex. But theoretically anyone with a computer can randomly decide to mine the coin and participate in the network. This whole process is made possible by Proof of Work, which was the key brilliant idea that made bitcoin secure and possible. The problem right now is this algorithm doesn’t allow very many transactions per second.<p>Other currencies have experimented with something called Proof of Stake to solve the scaling problems but it’s not known if it can be as secure as proof of work. Facebook’s currency will probably use this method. The basic idea is that the holders of the currency vote for what happens on the network. It’s an interesting idea but it’s a very different direction than the key idea of bitcoin.<p>Another issue is that governments rely on setting interest rates to manage their economies. If an internet currency starts to take off that will limit their ability to do this. At that point you can expect major pushback.<p>And also, the cryptocurrency ecosystem is a huge target for hackers. Millions of dollars have been stolen over the last decade. Brilliant attacks have been created to exploit the tiniest flaws in code. The phone numbers of crypto enthusiasts have been hacked and their wallets drained. Hackers have even embedded malware on websites or servers to mine cryptocurrency on computers they don’t control. Facebook will need an iron clad security process if it wants to succeed.
> It isn’t known, even to some members of the consortium, how the coin will work or what their roles will be, people familiar with the project said.<p>Such a stablecoin still requires a regulatory approval process before roll-out.<p>Just as a reminder that there are open alternatives, GNU Taler would offer a more privacy-oriented stablecoin with an already clear specification, but has not yet been adopted by banks that require the regulatory approval. On the mailing list, the developer wrote that they work on the two missing features needed for approval (cross-device synchronization and an integrated backup solution).
Why does this centralized stablecoin need to be crypto? It's not like they need to raise funding for this.<p>They could have made their own boring but extremely well positioned WePay / Paypal alternative ages ago, and instead they waited until cryptocurrencies are past peak hype to launch this. Puzzling.<p>I guess the only thing they have to sell here is the privacy aspect of crypto, but I doubt you'll get effective privacy from Facebook on any Facebook platform, crypto or not.
<p><pre><code> Facebook Inc. has signed up more than a dozen companies
including Visa Inc., Mastercard Inc., PayPal Holdings Inc.
and Uber Technologies Inc. to back a new cryptocurrency it
plans to unveil next week and launch next year.
</code></pre>
This means each of these companies will pay $$$ to run a "node" for this currency and have full visibility into the transactional behavior of the users of the coin.<p>The term "cryptocurrency" is applied a bit too liberally in the space, but what are the odds that Facebook's coin is censorship-resistant? Will Facebook help enforce US monetary imperialism, or will it thumb its nose at US sanctions? (e.g. allow a US Facebook user to send Libra to Iranian Facebook users)<p>Now, there could be a surprise plot twist in which these megacorps stand up for individual liberties. There have been stranger things.
> It has been a decade since bitcoin was born, yet consumers hardly use it—or the hundreds of other cryptocurrencies—to pay for things.<p>And why would they? Adding two extra steps to paying someone -- the buyer converting local currency to bitcoin, and then the seller converting bitcoin to local currency -- can never compete with just transferring local currency directly. Cryptocurrency was meant to be much more than just a payment system.<p>Cryptocurrencies will not succeed until they close the loop: people receive their wages in cryptocurrency, which they use to pay for consumer goods in retail stores that accept only cryptocurrency (because their suppliers would pay their employees in cryptocurrency).<p><i>This</i> is where cryptocurrency would shine, ie. by creating a global credit market, since the unit of account could be the same for e.g. Turkey, Nicaragua and Vietnam. A global cryptocurrency-credit market could arise, in which savers finance e.g. consumer goods on the shelves of retail shops. This would incentivize savers to purchase cryptocurrency in order to earn a low-risk return on their money -- something which is not possible to do in most Western economies with short-term interest rates at zero or below.<p><i>PS: If anyone is interested in creating the software infrastructure to make this happen, please let me know.</i>
IMO this is it, the last best chance for a cryptocurrency to take off and actually be used as a currency and not a speculative vehicle. If Libra fails, even with all of Facebook’s resources at its disposal, then there is unlikely to be any viable cryptocurrency for at least another generation.<p>Disclaimer: I hold a lot of stock in FB and no positions in other crypto.
I'll be honest, I'm excited.<p>The biggest hurdle to Bitcoin adoption are on-ramps / off-ramps. Businesses and individuals dealing with Bitcoin frequently get de-risked by banks and suppressed by regulators (e.g: China & India).<p>Libra if (a) can be interacted with via API, (b) can itself be acquired via bank transfers / credit cards & (c) not geo-fenced, will eventually be adapted into one of the many exchanges and will contribute greatly to solving Bitcoin's on-ramping issues.<p>Whether consumers want Bitcoin once they've tasted Libra, well that's an ideological choice. It'll be interesting to see how it plays out.
Visa MasterCard and PayPal are just there to ensure that they don't get left behind if the FB coin succeeds, payments are their bread and butter, so if they can hop on the train they can be partially insulated. Otherwise they don't care.
Can anyone explain how this will be different (from a user perspective) than any other tech enabled payments platform (Alipay, Paypal, Venmo etc)?<p>What's the rationale?
The only reason Facebook is doing this is so they can track your purchases and mine even more of your data.<p>This reminds me of what WeChat is doing in China, where most purchases are made and tracked by the government from this app. I don't even know if you can use cash there anymore.<p>With the amount of information Zuckerberg has on the US population, he shouldn't ever be allowed to run for president while still running Facebook.
Facebook has done horrible things, but bad business is not one of them. They already have 2 billion+ people on their platform(s) and if Facebook enables a virtual currency to exchange goods (real or virtual) it may be a hit. Just like mobile wallets have taken off pretty well, this could too. Again, I am not a facebook fan, but they know how to make money. This could be the next billion dollar idea.
Can't read the article. What is it backed by? Where's this information coming from? I can't find any press release or sources that aren't publishers themselves—this smells like insubstantial technology and bought hype (not that it won't work...).
As it's said in another comment, it's not cryptocurrency when it's centralized and by a singe entity<p>i'm seeing it like all the in-game currency, controlled by the entity convert your local currency to this platform bucks to use it ONLY inside that platform
<< A Facebook spokeswoman declined to comment. >><p>Every time I see this kind of news, I wonder, how do journalists get so much information when "an official spokesman declined to comment". Is this mainly just buzz so FB is in the headlines?
I've met a hell of a lot of authoritarians in the crypto scene over the past decade. Blockchain technology is a centralized datastore so of course it's a tool for global authoritarianism; think IBM in the 1930s selling slow databases to the Nazi's so they can keep a universal ledger of the Jews.<p>P2P distributed architectures such as Holochain which actually decentralize data and control are far more positive paradigms for humanity.
I remember a Blockchain related story here in HN some days ago where someone said that he did not believed in blockchain because there were no big-name Engineers working on it, specifically nobody from FAANG.<p>There you go...
Yeaaaah, Facebook doesn’t give a shit about privacy and love to sell our data for $$. What makes them think we will trust them with our banking info? Lmao.
Finally! A cryptocurrency with the ethics of Uber, the censorship resistance of Paypal, and the centralization of Visa, all tied together under the proven privacy of Facebook. Just what I’ve been waiting for.
Ugh. This will pass too. The value of Bitcoin is in the fact that nobody can control and censor it. It's black market money. If it didn't have this quality, it'd be useless. Nobody (meaning customers) cares about Facebook launching a coin. Facebook will not be the champion of freedom. How do I know? Ask yourself, if Facebook Coin is going to be available in Crimea (currently under sanctions) or Iran (currently under sanctions) or China (where facebook is banned). The answer is of course not. Bitcoin is available in all of those places and not a single government was able to do anything about it yet.
What I find hilarious is that Zuckerberg has probably been trolling the forums of bitcoin.org and reddit crypto groups for many months.<p>And like any good crypto "expert", he spent his time sharing opinions and copying other peoples source code versus building anything real.