Bitcoin will also survive the cryptocurrency of Facebook
The launch of Libra, cryptocurrency of Facebook, is planned for 2020. Its success could give Bitcoin greater visibility and positively influence its price. white paper companies centralization payments
The creation of a cryptocurrency by Facebook, one of the largest social networks on the Internet, has generated great expectations, especially for what it can mean for Bitcoin and the ecosystem of cryptoactives.
The bitcoin of Facebook?
Although Libra has been raised as a cryptocurrency, its characteristics are not very close to Bitcoin. This project has been supported by large companies such as Uber, Paypal, MasterCard, Visa, Mercado Libre, among others, and has attracted the attention of the public.
Each of these companies invested USD 10 million to form part of the association that Libra will manage. In this way, their team ensures that neither Facebook nor any of the companies will control the cryptoactive independently. It should be noted that the Zuckerberg company has created research and development teams for distributed accounting technology since 2018.
Despite this, a significant point of the project is that technical details have not yet been revealed: it is not known which blockchain will be used or if one will be created; neither is it known if the cryptocurrency will be compatible with other similar projects. These details should be unveiled with the publication of Libra’s white paper, proposed on June 18.
At first, the cryptocurrency was called GlobalCoin. However, the project is called Libra and its launch is planned for 2020. It is expected to be an anchored cryptocurrency, as they work tether (USDT) or Paxos (PAX), although backed by a basket of assets from which its price will be derived.
The idea is that Libra also works on WhatsApp and Instagram. Source: Pixelkult / Pixabay.
In the long run, the goal is to create a system of payments and exchange of value that could be integrated into WhatsApp and Instagram, two other important networks and social platforms that are part of Facebook Inc. If fulfilled, the cryptocurrency could be within reach of more than 2,700 million people who use these networks.
This could mean competition between the Facebook system and high-reach payment processors such as VISA, MasterCard or Paypal.
According to information published from the corporation in early May of this year, Facebook users could receive rewards in this cryptocurrency to see publications, have interactions and buy products on the platform.
Implications for Bitcoin and cryptocurrencies
One of the major consequences of this launch is that Libra could give impetus and visibility to cryptocurrencies in general, but especially to Bitcoin, the most capitalized cryptocurrency in the market.
On a speculative level, the implementation of this cryptocurrency could translate positively into market prices; in the face of public opinion, it could mean a way of not losing track of technological development: “these big companies are investing in this technology, this must be good”.
Despite Libra and Facebook, Bitcoin will probably continue to exist. In this way, the millions of Facebook users would not only be exposed to Libra and its influence as a payment system, but could be induced to know more about the market and other cryptographic projects that are already running.
In this scenario, and despite the corporate support that Libra has, it is difficult to think that a nascent project (with centralized characteristics, under the administration of a business association) could completely unseat Bitcoin, which supports a global system of decentralized exchange of value and resistant to censorship.
If Libra is successful, it could replace other digital payment methods such as Paypal, but it is unlikely that it will be able to bend the decentralization of Bitcoin: they do not compete at the same level.
n this case, although the cryptocurrency of Facebook could gain relevance and weight, its characteristics could be different from those of the cryptocurrency designed by Satoshi Nakamoto. In any case both coexist, with the probability that the average Internet user prefers Libra, the credibility of the companies that support it, the good progression of the project and the visibility of it through social networks.
In the event that the Facebook project fails, either due to technical factors, differences between members of its association or lack of interest of the common user, the popularity of the topic could positively influence the perception of Bitcoin. Although it is not managed by central authorities, it still works, being the market reference for cryptocurrencies.
Due to the possible differences between both systems, a scenario where Libra fails would not have an impact on the perception of the value or the trust that the community has in Bitcoin.
The Libra project seems to use the cryptocurrency boom to offer a new payment system to rival Paypal and other options already established. As far as is known, their characteristics are far from a cryptocurrency. The corporate approach and the management of its operation by a business association call into question the possibility of making decentralized and censorship-resistant payments, as offered by Bitcoin.
So, even though the launch of Libra may influence Bitcoin’s near future, this cryptocurrency will probably outlive it.
Disclaimer: This press release is for informational purposes information does not constitute investment advice or an offer to invest. The views expressed in this article are those of the author and do not necessarily represent the views of infocoin, and should not be attributed to, Infocoin.