In this day and age, where the use of hard cash is overrated, the interest surrounding cryptocurrency is at a new peak. There are many financial and personal benefits and acts like a completely new type of currency- something connecting the nations, something common between them.
The Libra Coin is one such type of future prospect, introduced by Facebook, to improve lives across the globes. The Libra coin is, at the moment, just a concept introduced by the multi-million dollar social networking site owned by Billionaire Mark Zuckerberg, and is set to be in full effect 2020 onwards.
The major details of the project have been kept under wraps and only little is known at the moment. There is a lot of confusion about the currency about the moment and many questions. Why would a social networking site suddenly set out to venture into the world of finance? What is different about this currency that hasn’t been introduced before? What does it really do? How is the game going to change from now on?
Well, we are here to answer your queries and highlight the important points about the new venture.
What is the Libra coin?
The Libra Coin is a form of cryptocurrency- owned by Facebook at the moment, set to be launched in 2020. It is a permissioned block chain currency entrusted to the Libra Association.
It comes under another financial subsidiary of Facebook- the Calibra, an online payment platform. The current validators of the program are Visa, Mastercard, PayPal, Ebay, Coinbase, Lyft, Uber and many more. With the support of such major corporations and the validation from all major sectors of finance, the primitive code and idea of the Libra coin were set up.
What is the objective of the Libra Coin?
The Libra coin is a non-profit organisation which aims at improving the lives of people all around the globe by transforming digital bank services and bringing these services to the unbanked areas.
It is backed by many associations aimed at improving the financial situation of not just the United States, but countries all over the globe.
What is the block chain?
If you search online, the web offers a very complicated definition of the word, and it takes some time to understand. The basic meaning and purpose of the blockchain are to keep a record of any and all transaction made by the user.
To simplify the process, let’s assume there are a 1000 people using the Libra coin. In this case, one libra coin is divided into 1000 parts, and each part’s transaction is accounted for, for security and proof of use.
Where does Calibra come into all of this?
Calibra is basically an application which will use Libra coin as its currency. It is like an online payment app, which uses only the libra coin to transfer funds across the globe.
It is another subsidiary of Facebook and is to be released soon after the release of Libra coin in 2020.
How is it different from other currencies of the different countries?
Like India has the Rupee, the USA has the Dollar, Japan has the Yen- each country has its own currency. Each currency is treated as a stock which can be brought in exchange for your local currency, and their values keep changing.
Likewise, Libra coin is also a currency with the same pattern of sale and buy in the stock market- but instead functions on a worldwide basis. So a person sitting in the USA is going to buy the Libra Coin for the same amount as someone Sitting in India, and this can be used for all transactions between two parties.
This can be exchanged for your local currency- much like bitcoin according to the stock market values.
Then how is it different from Bitcoin?
Bitcoin was bought into the world as a gaming currency- you can mine it. At the start, it had absolutely no value. But nearly 10 years after its invention, the value was suddenly inflated to 5000 dollars, making a lot of people rich instantly. Since then the value of the bitcoin has been changing drastically on a daily basis, ranging from 1000s to the 10,000s. this makes the currency very unstable for transaction use.
The libra Coin was thus a project taken up, in need for a form of cryptocurrency which provided more stability. The value of the Libra Coin is much like any currency in the world, which undergoes subtle changes on a day to day basis and not the drastic ones that bit coin usually goes through.
Also, the Libra coin is strongly backed by the real-world assets and government support, providing a further reduction in volatility.
How can I buy the Libra coin?
No details have been shared about the sale of the currency. But it is going to be the same process as buying any other stock in the share market.
What is Facebook’s role in all of this?
Honestly? Not much. Facebook has almost no power on the Libra Coin. Instead, it has control over its subsidiary- Calibra. The customer data of a facebook user is in no way connected to this application or the use of the cryptocurrency.