The Central Bank of Facebook

[Abiky]

People have a very negative attitude towards the banking system, but are thoughtlessly happy about the new project from Facebook.  It seems to me that even in this case, you need to be very careful not to create unnecessary problems for yourself.  Of course, I understand that Libra can be a real substitute for existing payment systems.

Most people don't understand how cryptocurrencies work. They're only in it for the money. This explains why most of them believe that Libra is better than a traditional bank, as they don't perform their own research. When the moment of truth comes into play, they will realize that they've been wrong from the start. Facebook's Libra cryptocurrency will become the world's Central Bank 2.0, if its launch becomes a success.

Most governments have realized the true potential of Blockchain technology, which is why they're afraid that cryptos like Libra will take over the world. The main intention of governments worldwide is to stay in control no matter what. They aim to achieve this by forcing people to use their national currency instead of other alternatives. Which is why, I believe that most governments will do anything within the power to try to stop Facebook's cryptocurrency from becoming a reality anytime soon.

The US has already been reacting towards Libra, in a negative way. They could prevent Libra's development from taking place within the mainstream world. If they allow Facebook to launch their coin, then it will become a disaster for our economy as we know it. People won't have any privacy at all when performing their transactions with Libra, as Facebook audits its internal Blockchain ledger. But, everything will depend on how governments will allow this to happen.

Nonetheless, if we have decentralized cryptocurrencies like Bitcoin and Ethereum, we shouldn't worry much about Facebook's Libra coin as it'll become another central banking system like traditional Fiat is right now. Just my thoughts

[RealMalatesta]

-snip-

Facebook currency will become a reality because there is nothing one can actually do to stop the technology from being released, they have every right to apply what will benefit them, but it will never gain the market dominance as we think, do you know how many countries that we have in this world, and each of them have their own policy, and so far they still have law in place that the citizens fear, then nothing to worry about Facebook coin.

Before Facebook coin can really gain that popularity in any country, then the government of each country must have accepted it which like you say will be impossible because everyone wants to protect their own currency, in fact starting from china and India alone, Facebook coin is already a failure being that they have the largest population in the whole world.

[davinchi]

I don't understand how people think that libra will be like a stablecoin or like a crypto currency. It is not, it has nothing to do with it, the project is based on blockchain from what we hear and that is the common part but it is just a very improved version of paypal that's it. They will have blockchain and tech behind it and they will create the project so people can send and receive money easily from facebook/instagram and mostly whatsapp but it will not be anything more than a paypal/venmo thing which is why they will not get big.

I mean their size depends on the money they have, its not like price of libra will go up, it won't and that is not how it works, do you invest into usdt so it will go up? No. You use it for yourself for trading, same will happen for libra as well, its not a crypto currency, its a stablecoin AT BEST.

[Abiky]

Facebook currency will become a reality because there is nothing one can actually do to stop the technology from being released, they have every right to apply what will benefit them, but it will never gain the market dominance as we think, do you know how many countries that we have in this world, and each of them have their own policy, and so far they still have law in place that the citizens fear, then nothing to worry about Facebook coin.

Before Facebook coin can really gain that popularity in any country, then the government of each country must have accepted it which like you say will be impossible because everyone wants to protect their own currency, in fact starting from china and India alone, Facebook coin is already a failure being that they have the largest population in the whole world.

We may not be able to stop the technology from being released, but the government could do so at any moment. After all, we've seen how the US has been concerned of Libra's legitimacy within the mainstream world. President Trump has expressed his ideas of Facebook's cryptocurrency, where it can be used for various illegal activities. Regulators from various countries have bashed against Libra, as they're afraid that it might replace the world's monetary system.

Believe me, many governments are aware how powerful Blockchain technology is. Facebook's aim of becoming the world's next-generation central Bank with Libra coin, will prove to be a threat to the existence of Banks worldwide. That's contrary towards the proposition of governments as they want to gain control over their people's finances. Central Banks want to remain in power, which is why they'll try to do anything at their disposal in order to destroy Libra at all costs.

Luckily, that won't be the case for other cryptos like Bitcoin and Ethereum because they're highly decentralized and censorship-resistant (unlike Libra). With their distributed nature, and ever-growing support from people within the mainstream world, they become a force to be reckoned with. Libra has a higher risk of failure within the long term, because of its single point of failure (Facebook). If it becomes a success, then it could bring a greater level of adoption for Blockchain tech within the mainstream world.

Nonetheless, Facebook would need to go through various regulations in order to establish itself as a central bank. And since it aims to become a global financial institution, it's going to become even harder to comply with all of the world's regulations. Which is why, it's very unlikely that Libra will launch by 2020. Just my opinion

[shulc7]

-snip-

Facebook currency will become a reality because there is nothing one can actually do to stop the technology from being released, they have every right to apply what will benefit them, but it will never gain the market dominance as we think, do you know how many countries that we have in this world, and each of them have their own policy, and so far they still have law in place that the citizens fear, then nothing to worry about Facebook coin.

Before Facebook coin can really gain that popularity in any country, then the government of each country must have accepted it which like you say will be impossible because everyone wants to protect their own currency, in fact starting from china and India alone, Facebook coin is already a failure being that they have the largest population in the whole world.

Some people afraid that Libra will become the number one rival of Moneygram and Western Union as initially this coin is planned to be used for the online transactions.
Certainly, many people are looking forward to the day, when it is released. I do not remember the coin which could become popular before its release as it happens to Libra now. Actually, it will be a kind of a revolution.

[lixer]

I honeslty 100% agree that people are not interested in bitcoin because they can see what it can achieve in the future and how it can change our financial system from the bottom and make the world a lot more equal between rich and poor. Right now the system is crooked towards rich people and the gap between rich and poor is getting wider and wider.

They are only interested in using bitcoin to get richer and that seems to be a big problem. That is why libra wouldn't change too much, they can't get rich using Libra since its just a security and stablecoin so if facebook ends up saying 1 libra equals 1 dollar then doesn't matter how much you invest it will end up the same amount since it won't get up. That means the people who are mostly interested in bitcoin for more money will not be interested in libra.

[jostorres]

We know that Facebok is the biggest social media in the world, so it's not surprising that their plans are of concern to the whole world. many important people who responded. and not a few of them responded negatively, even trump responded to it via tweeter

Trump too never supported it, and I think so many people have responded to it negatively, I think the issue with this Libra coin is that it created a system that would connect world financially, which may make the world’s finance to be under his control, because if you look at it, it is assumed that he wants to create a global currency, and if you look at the world global, it seems like trying to encompass the whole continent of the world, and how can the world submit to Facebook.

I know that the CEO is rich, but it would be a shame to the world leader if they also allow him to use his money to control them, their citizens and the world at large in the financial system. Well, with time, we will see exactly what Facebook coin intends to do when it is being released.

[Searing]

-snip-

Facebook currency will become a reality because there is nothing one can actually do to stop the technology from being released, they have every right to apply what will benefit them, but it will never gain the market dominance as we think, do you know how many countries that we have in this world, and each of them have their own policy, and so far they still have law in place that the citizens fear, then nothing to worry about Facebook coin.

Before Facebook coin can really gain that popularity in any country, then the government of each country must have accepted it which like you say will be impossible because everyone wants to protect their own currency, in fact starting from china and India alone, Facebook coin is already a failure being that they have the largest population in the whole world.

I think you are correct. Indeed, if for some reason Facebook as a lead partner or with someone else in the lead partnership they are never allowed to make their own crypto, well, IMHO,

all Facebook would have to do is BUY Bitpay for say what 100 billion USD? Thus, bingo bango...they got their crypto they can data mine users about use and shopping of such,

which is the real reason for crypto, that data for ads, etc. Can't really beat up Facebook for using a service that has been in play for what 10 years?

This very well could be their backup position.

So the reason for their own crypto is they wanted complete control, but nothing I think could stop them from being just

another vendor or Bitpay and/or owner.

Anyway, my 'meandering' view of this topic. Not that I know squat.

Brad

[lepbagong]

Whatever Facebook does is their own right and that is a reality we must accept.
but for me what is done by Facebook is ripples that will eventually get used to, whether it will be accepted or not by the general public. at least it can enliven the technological developments that occur.

[Abiky]

Some people afraid that Libra will become the number one rival of Moneygram and Western Union as initially this coin is planned to be used for the online transactions.
Certainly, many people are looking forward to the day, when it is released. I do not remember the coin which could become popular before its release as it happens to Libra now. Actually, it will be a kind of a revolution.

There's a high probability that Libra might replace MoneyGram, Western Union, and several other traditional payment processors within the future, upon its successful launch within the mainstream world. This is because Libra will obtain Blockchain's benefits of high efficiency and extremely low costs for transactions. Since neither MoneyGram nor Western Union are using Blockchain technology, Libra will prove to be a superior system for mainstream payments.

Even if Facebook plans to "wiretap" Libra's transactions across the Blockchain, it'll still be a popular choice for people within the mainstream world. We've seen how many people don't care about their privacy, despite Facebook's latest scandals with its social network platform. Most people in the mainstream world are just looking for convenience, and ease of use. Considering that Libra will be a stablecoin pegged to the value of $1 USD, it has all the odds of becoming easily accepted by average people instead of decentralized cryptocurrencies like Bitcoin and Ethereum.

Nonetheless, Libra is still fighting its way towards launch by next year. If governments worldwide approve it, then there should be nothing stopping Facebook from becoming the world's next-generation central bank. After that, traditional banks may see their existence threatened by Libra unless they fully adopt Blockchain tech for their own benefit. In the end, Libra may be the USD's successor while it'll co-exist with decentralized cryptocurrencies for a long time. Just my thoughts

[BobK71]

They are not not creating money out of thin air.  They are still doing that but they are doing it more legit than you may think.

You think that the centralized ways of sending money will be totally free, there will be charges for it, even if not for transaction fee which I think that may happen as well or maybe not charging for having your money stored, it will be your financial history, facebook is known to sell their data of people on their websites to people who pay the most, so when you control the worlds biggest bank all of a sudden what will happen? They will be capable of seeing what you spend your money the most, you like to eat ice cream every once a week?

Well, your info will be sold to all ice cream companies, you like to bet on soccer matches? Your info will be given to sportsbooks, basically every single transaction you make will be data to sell for them. That is the money they create out of thin air, they like to watch over your expenses and be able to sell that data too.

Agreed.  Please don't misunderstand my words 'creating money out of thin air.'  (See below.)

Absolutely, the money issued will be backed by real value created in the economy.  Isn't this the same as fiat money everywhere today?  When engineers create something good in the lab, the central bank can issue new money without causing inflation, since there will be extra activity (growth) that provides legitimate demand for the new money.  And AFAIK Facebook has a very good lab.

It is the same for Facebook as everywhere else in the modern world.

The problem comes from the incentives built into this kind of money system.  Since the issuers of the money or debt, politicians, bankers and central bankers, have the incentives to keep issuing new money and debt regardless of economic growth, and have a lot of power to temporarily prop up the value of any new money issued above the growth, human nature says that, eventually, the system becomes unstable.  (If you see how well the long-term price of gold in dollars has done, you have the historical data for this argument as well.)

So, my definition of 'out of thin air' (and I apologize for not making it clear at the beginning) is: any issuance of money that is not backed by 100% reserves of another money.  (Now the 'other' money might itself be issued out of thin air, but that's not a problem for our issuer.)  If Libra would like us to believe it is 100% backed by national-currency reserves, don't believe it.

[BobK71]

Interesting topic,however I'm still not 100% sure that the libra project will be finished.
I was wondering what the Facebook's hidden goal might be and your post doesn't answer all my questions.
There must be something we don't know about Facebook's crypto(or pseudo-crypto) strategy.

I guess we never know for sure, but we can guess that it'll be the same as all the Western elites who benefited from issuing money and debt:

- Issue some claim to value which costs very little to produce in itself.
- It works better and for longer if your token can or will buy things that people really want.
- Use whatever power you have to prop up the value of your token: have the media write stories, start wars to force 3rd world countries to do what you want, whatever it takes.
- Keep issuing and strongly denying any instability as long as possible.
- Diversify or get out of that token yourself before it's too late.
- When at the end of your rope, devalue your token, enough to regain stability.
- Start the cycle all over.

[BobK71]

I guess they can do the copy of the same thing for themselves?
We are open to many other libra like stuff, as long as its crypto and in the blockchain realm we should all support it.

You can just hate facebook and not use libra at all but when its on the public and you want to talk about it I would say support it even if its a fake support because people who get into Libra because of the facebook name will be getting into crypto currency easier. Think about it which one is easier, going from fully fiat life to dealing with crypto a bit or going from some fiat and a knowledge about libra to a bit of crypto as well?

I would say libra would be our entry point for the new people, even old people can use libra to send money to their children whereas they will get to learn more about crypto thanks to it and we can attract them to bitcoin later on.

What we should aim to achieve is not necessary something that will help Bitcoin.  We should try to arrive at the truth, whatever the consequences may be.  If the truth comes out, eventually, if not immediately, it should always help things like Bitcoin.

[BobK71]

Libra's value will be pegged to a basket of dollars, euro, etc. by the Central Bank of Facebook.

No only.
Libra will be backed also by Gov bonds.

It will work like that:

Users give their money to Libra in exchange for Libracoins.

Libra will buy Gov bonds with the money of the users, in order to back its coins.

Libra will keep the yields of the Gov bonds bought with the users' money.

Evil geniuses

Ha ha!  Exactly how these things work!

[freedomgo]

Whatever Facebook does is their own right and that is a reality we must accept.

They can't just do whatever they want, they are guided by the law and therefore they need to seek approval first before they can implement what they like.
Libra has to pass with a lot of regulatory requirements before it will be launch and might take time.

[RealMalatesta]

~snip~

Facebook can never replace those companies that you mentioned, don’t also forget that the establishment of those companies has also increase the financial base of government and also better the economy of the country where they operate, do not first forget that those countries will first not do without given it a fight, and if it is blockchain technology that Facebook want to use to suppress them, they will simply just go on blockchain technology also.

These guys are strong competitors, and they are ever ready to face any competitors that may want to double cross them and even with the help of the government, Facebook will find it very difficult to send them packing because of its own system. Don’t ever expect government worldwide to ever approve it.

[Abiky]

Facebook can never replace those companies that you mentioned, don’t also forget that the establishment of those companies has also increase the financial base of government and also better the economy of the country where they operate, do not first forget that those countries will first not do without given it a fight, and if it is blockchain technology that Facebook want to use to suppress them, they will simply just go on blockchain technology also.

These guys are strong competitors, and they are ever ready to face any competitors that may want to double cross them and even with the help of the government, Facebook will find it very difficult to send them packing because of its own system. Don’t ever expect government worldwide to ever approve it.

Good point. Existent payment processors are too powerful to come down anytime soon. They might as well adopt Blockchain technology in its entirety than doing anything about it while other alternatives take the lead in mainstream payments. Be aware though, that if traditional payment processors like PayPal, MoneyGram, and Western Union adopt Blockchain technology, then the competition will be fierce against Libra. By then, it would only be a matter of which payment processor provides the lowest fees and the fastest transactions possible.

As for Libra, its future will greatly depend on how many people use it, and how governments are willing to let it survive within the mainstream world. Facebook's ambitions of becoming the world's the next-generation central bank is not surprising at all, especially since it's been a threat towards people's privacy. The newly-issued digital currency would serve as a surveillance tool for Facebook, as it'll be able to keep track of people's transactions with ease. Facebook will quickly report those transactions to the government, whenever it sees anything unusual within its Blockchain ledger.

Which is why, I believe that it's best for Libra to never become adopted by people within the mainstream world in order to prevent another scandal like the one happened with "Cambridge Analytica". Even if it becomes popular, it might benefit the crypto industry in many ways. The success of Libra's launch would lead other people to look for other alternatives as well. Once this happens, decentralized cryptos like Bitcoin and Ethereum would gain massive traction within the mainstream world.

Nonetheless, Facebook is going to have a hard time with governments and central Banks worldwide. It would seem rather impossible to comply with regulations on different countries worldwide. Such entities would battle their way towards non-stop power by reducing Libra's influence within the mainstream world. Hence, only decentralized cryptocurrencies will prevail in the long run. Just my thoughts

[Ozero]

Whatever Facebook does is their own right and that is a reality we must accept.
but for me what is done by Facebook is ripples that will eventually get used to, whether it will be accepted or not by the general public. at least it can enliven the technological developments that occur.

Facebook doesn't seem to release its Libra coin. The United States and other G7 countries simply will not allow this and will legislatively prohibit its use on its territory. It is no coincidence that Visa has already refused to cooperate with Facebook regarding this coin. Anyway, Facebook will be very difficult right now. I think they themselves will eventually abandon this project.

[Spaffin]

Something recently around the new Facebook project has flared up quite a lot of scandals and therefore today there is a good chance that this project will not be implemented.  I think that the special services and the US government have succeeded in imposing a moratorium on the implementation of the Libra.  Someone may not like my opinion, but I would not want all my personal data, including information about balances and transactions to belong to Facebook.

[STT]

Facebook itself wont be a central bank but by holding a basket of currencies and addressing a population of billions it will highlight the already standing differences between central bank standards throughout the world.   This Libra might encourage the greater flow of currency from weaker currency into the more strongly defended currencies that have less inflation.    Obviously anyone in Venezuela would immediately be better off siding with such an arrangement but also its true for some of the largest countries in the world, Libra could become the safe preference for free cash.