Facebook has confirmed its plans to launch a cryptocurrency in 2020.
The currency, named Libra, will launch at some point next year in a wallet called Calibra, where users will also be able to store other cryptocurrencies in the same digital space.
Facebook first attempted to launch its own digital currency back in 2010 in the form of Facebook Credits, although this never took off and the project was scrapped the following year.
Libra, however, marks a new direction for the company and has received backing from some of the world’s most established and respected names, like MasterCard and PayPal.
Rather than a for-profit venture, Libra is a non-profit under The Libra Association. Facebook is a member of the association and will lead the project for now, although overall, it will be controlled by a number of members so that Facebook doesn’t come under fire for managing yet another company.
Many have argued it should spin Facebook off from its other social networks, Instagram and WhatsApp, as the company has grown too big and dominant.
MasterCard, Visa, PayPal, Uber, eBay, Vodafone and Mercy Corps have joined as partners of the foundation, with plans for 100 members in the association, each of which paying $10 million to get the project started.
What’s important to note is that each member will hold the same power and can vote on all decisions, so Facebook won’t be a majority in the project.
What sets Libra apart from other currencies is that it will be monitored and tracked based on a number of other assets, so it’s less likely to suffer huge peaks and troughs as we’ve seen with some cryptocurrencies such as bitcoin.
Speaking of the project, CNET said: “Unlike bitcoin and some other cryptocurrencies, which aren’t backed by anything and swing wildly in response to speculation, Libra will be pegged to a basket of assets that will anchor its value.”
Facebook added that Calibra, its new cryptocurrency wallet, would be a ‘safe place to store your Libra currency,’ telling journalists: “When it launches, Calibra will have strong protections in place to keep your money and your information safe.
“We’ll be using all the same verification and anti-fraud processes that banks and credit cards use, and we’ll have automated systems that will proactively monitor activity to detect and prevent fraudulent behavior.
“We’ll also offer dedicated live support to help if you lose your phone or your password — and if someone fraudulently gains access to your account and you lose some Libra as a result, we’ll offer you a refund.”
Facebook was quick to defend the security of the project, adding: “Aside from limited cases, Calibra will not share account information or financial data with Facebook or any third party without customer consent.
“This means Calibra customers’ account information and financial data will not be used to improve ad targeting on the Facebook family of products. The limited cases where this data may be shared reflect our need to keep people safe, comply with the law and provide basic functionality to the people who use Calibra. Calibra will use Facebook data to comply with the law, secure customers’ accounts, mitigate risk and prevent criminal activity. “
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