Libra & Calibra explained: 6 things to know Facebook’s crypto currency & wallet! Is it safe to use?

What is a better way to make money than
targeting money? Facebook? What Facebook? Facebook has announced their plan to establish a cryptocurrency called Libra which would be overlooked not just by Facebook but by an association of 28 nonprofit organizations which will be
launched in early 2020. Libra would be a digital currency which would be backed by real-world assets such as bank deposits, government securities and so on and would be helped by a network of custodians. Facebook claims that Libra is intended to foster trust and stabilize the price, although Libra’s price might not always align with the underlying assets. Very important to note that the value of Libra might not depend upon the real-world assets, which means that it can go high and low at times and investors should pay close attention to the value of this currency. Libra transactions will be powered by a recorded blockchain. To put it in simple terms, blockchain is a shared ledger of transactions that is maintained by a network of computers so anybody who makes a transaction will have a record in this ledger and would be visible to network of computers. Libra would be a little bit different from cryptocurrencies like Bitcoin as it is permissioned, at least for the next five years. Permissioned blockchain means that only entities authorized by the governing association will be able to run the computers. This basically differs from blockchain currencies like Bitcoin which does not have any entities in charge The software of Libra will be open source meaning that companies outside the association can build applications on top of it. Now, as mentioned earlier Libra would be overseen by an association of 28 nonprofit organization which includes
companies like Visa, PayPal, MasterCard, Uber, Vodaphone and so on. The members will have one vote each on important issues which means that Facebook only has 1/28 of power when it comes to important decisions regarding Libra. Even though it seems like Facebook will not be directly benefited by the cryptocurrency that it is launching, one thing that will definitely benefit Facebook is the wallet that it is launching for the transaction of the cryptocurrency. The wallet is named Calibra and it will be available as a standalone app on smartphones as well as a button within Facebook’s messenger, Instagram, and WhatsApp. Now as of today, Facebook is employing a hundred member team for the development of Libra which would be headquartered in California. Now, every person who wishes to use Calibra has to go through and know your customer or KYC process which verifies the user identity. Alright let’s come to the important question of how it is going to affect you and whether you should use this particular currency! I think there are two ways in which you should think about this particular scenario. First of all as an investor: it is extremely important for you as an investor to keep an eye on this particular currency because it’s being launched by Facebook, whose user base is 1.7 billion people and when they are launching such an ambitious project it is most probable that they are going to have an impact in the financial world. Secondly as a regular customer: as Facebook has already promised that they will not use your data for targeted advertising and they have an association of 28 nonprofit organization to overlook this currency, if it is going to improve convenience why shouldn’t you use it? A survey by a news app called in shots asking people whether they are interested in using Libra, turned out that 52% of people were interested in using it. But, will you be interested in using it? Let me know by voting up here in the cards and as always thanks for watching.

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