Facebook becomes a financial service provider. The company has unveiled its own cryptocurrency Libra and offers the right digital wallet with Calibra. In the future, cash transfers should be as easy as sending a text message.
Libra is a stablecoin and can not be mined
Facebook has founded the eponymous subsidiary for Calibra, which claims to be independent of Facebook. Libra is the name of the next cryptocurrency, which, like many others, relies on blockchain mechanisms to become a global, purely digital and secure means of payment. However, in the context of the Libra Reserve, the virtual means of payment should be secured by other currencies and investments, the operators promise.
For example, Libra differs from Bitcoin and Ethereum and is known as Stablecoin. The purpose of hedging is to avoid price fluctuations and resulting speculation. In addition, the currency can not be “mined” electronically. A Libra is expected to hold close to $ 1, $ 1 or £ 1 TechCrunch, but the exact course is not fixed yet.
Calibra handles Libra transfers via smartphone
The second link in the chain is Calibra as a digital wallet for worldwide transfers of Libra between individuals. But Libra and Calibra are also being considered as means of payment in the business environment and later also for the offline payment at the cash register. Calibra is both offered as a standalone smartphone app and integrated into the Facebook services Messenger and WhatsApp. The starting signal will be given sometime in the year 2020.
Facebook advertises to simplify the payment transactions with Calibra or to enable people without a bank account in this form. Facebook refers to surveys made by the World Bank Group in 2017, according to which “Nearly half of adults in the world do not have an active bank account“.
Transfer fees according to Facebook “low and transparent”
As praiseworthy as the plans appear, all this does not happen without self-interest. Facebook creates in this way the step on the floor of the financial service providers and will not offer the service for free, but “low” and “transparent“Require transfer fees; Details have not been revealed. In addition, Facebook offers added value for its established services, which in turn will benefit Calibra.
Start-up capital through well-known founders
The cryptocurrency Libra is administered by the Libra Association, an independent organization headquartered in the Swiss city of Geneva. Its founding members include established financial service providers such as Visa, Mastercard and PayPal as well as eBay, Uber and Vodafone. Each member must invest at least $ 10 million in Libra investment tokens, resulting in high seed capital. Facebook is also a founding member and does not receive any special rights, but like everyone else “only by a majority of one vote or 1% of the total votes in the Council“.
Libra and Calibra should be safe
Due to extremely sloppy behavior in dealing with user data, Facebook has not recently created confidence in the company. The distance from the foundation of an independent subsidiary for the crypto ambitions is therefore only logical. Because when it comes to money, security and trust are the nuts and bolts.
“We use the same screening and anti-fraud procedures as banks and credit cards and have automated systems that proactively monitor activities to detect and prevent fraudulent behavior“Says the announcement. In addition, reimbursements in cases of fraud and live support in case of lost password advertising.
Without the consent of the user, no account and financial data should be shared with Facebook or third parties. This also means that Facebook does not use Calibra data for advertising purposes. In individual cases, for example for legal or safety reasons, a data exchange is possible.
Update 19.06.2019 13:04 clock