On June 18, the social media giant has published the white paper of the Libra project. This information has been anticipated for a long time. Facebook's cryptocurrency has a chance to contribute to the global adoption of all coins, but what do analysts think about it?On Monday (the day before the publication of the white paper) a material issued by a group of specialists in the cryptocurrency industry presenting opinions on the Libra project has appeared on CNBC. We believe that this may be one of the most important initiatives in the company's history - says Mark Mahaney, the RBC analyst. He notes that it will also be a new source of revenue. According to RBC, the social media giant will focus on three main areas: payments, commerce, and applications and games. Mahaney assumed that the first phase would involve users' engagement and that the entire strategy would be a multi-stage process. In turn, SunTrust, an American bank holding company, indicated that as a result of this initiative Facebook will be in the spotlight, going beyond the traditional advertising. According to SunTrust, this will reduce anti-trust issues, which appeared due to the diverse nature of the partners and the consortium included. The social media giant will be the key to the development of the Libra project. The company also emphasizes the fact that until now no other company could bring as huge diversity of users as Facebook.
Global reachAccording to analysts from the research company called MoffettNathanson, Facebook's project goes beyond social media. They remain convinced that the giant is committed to becoming the world's leading e-commerce platform. They also shared observations related to the impact of Facebook's cryptocurrency payment system on countries with high inflation or unstable banking systems and foreign communications, claiming that it can be an extremely useful tool in these areas. MoffettNathanson emphasizes that Facebook's ambitions will not be limited to developed markets only. Even one of the largest banks in the world in terms of assets - Bank of America - has issued an opinion on Libra. According to the bank, the consortium would gain a lot of publicity and visibility, so that it could become a catalyst for electronic commerce on Facebook. It also notes that this is a very important initiative because it will create a private ecosystem. City-Buy decided to share its views on the matter as well; it says that this project will bring a huge stream of profits in the upcoming years. Cryptocurrency will be of use not only in case of P2P transfers but also to commercial purchases, including Instagram Shopping and Facebook Marketplace. Mark Zuckerberg himself said that sending money should be as simple as activities such as sending a photo.
The Winklevoss twins comment on the Libra projectRelations between Mark Zuckerberg and Cameron and Tyler Winklevos are tense. As everyone knows, the brothers accused the creator of Facebook of stealing their idea for a social networking site. The twins won a court settlement of $65 million. According to the information released on May 23 by Financial Time, Zuckerberg interviewed his old rivals about the development of the Libra project. On June 16, the Winklevoss brothers appeared at CBS News Sunday Morning.
Libra's white paperAccording to the information presented in the white paper, the aim of the Libra project is to provide users with both low-volatility cryptocurrencies and an intelligent contractual platform. It was also found that blockchain has a number of unique properties that can contribute to solving many problems related to availability and reliability. Moreover, it was emphasized that global, open, immediate and cheap cash flow would increase both economic opportunities and trade around the world. It is hoped that people will begin to trust in a decentralized form of management. The Libra financial system was built on a scalable and reliable blockchain. It is supported by a reserve of assets designed to give it internal value. It is governed by the Libra Association - a non-profit organization based in Geneva (Switzerland). The aim of the association is to coordinate and provide a management network and ensure that subsidies support financial integration. Its members will be dispersed by various enterprises scattered around the world, miscellaneous organizations and academic institutions. The project assumes that in the first half of 2020 more than 100 members of the Libra Association will enter the market. The founding members will include:
- payment companies: Mastercard, PayPal, PayU (Naspers' fintech arm), Stripe, Visa
- technology companies: Booking Holdings, eBay, Facebook/Calibra, Farfetch, Lyft, Mercado Pago, Spotify AB, Uber Technologies, Inc.
- telecommunications companies: Iliad, Vodafone Group
- blockchain companies: Anchorage, Bison Trails, Coinbase, Inc., Xapo Holdings Limited
- Venture Capital: Andreessen Horowitz, Breakthrough Initiatives, Ribbit Capital, Thrive Capital, Union Square Ventures
- Non-profit organizations and academic institutions: Creative Destruction Lab, Kiva, Mercy Corps, Women’s World Banking