Facebook’s digital currency project, Libra, which has faced huge uphill battles since it was announced in the summer of last year, is quickly approaching its launch date. The project is supposed to be going live this year, but the regulatory backlash it has faced has made many wonder if this will be the case.
However, for the first time in a long time, there has been a bit of action from the project as yesterday it was announced that the Libra Association, which is a group of major businesses supporting the project, would be getting a new member. eCommerce platform Shopify was the latest addition to the association, and this comes after a bevvy of big companies left recently.
The likes of PayPal, Visa, Mastercard and Stripe have all pulled out citing regulatory concerns, among other reasons, as the determining factor in no longer wanting to be involved. However, Libra is still moving along, even though probably not as rapidly as they would have hoped.
Now, Calibra‘s digital lead Ben Maurer is the latest to comment on Libra’s developments. Maurer recently gave a presentation on the topic ‘The Libra Blockchain and Move: A Technical Introduction,’ at the Stanford Blockchain Conference 2020 and spoke about Libra’s current status and its goals, once launched.
The idea of a global cryptocurrency that is aligned to three major apps with over 2 billion users has big connections for a new financial system, but then there is a lot more that can be accomplished with Libra, as Maurer notes. He said that Libra’s mission is to solve the lack of access to financial services. He went on to note how approximately 1.7 billion adults globally are unbanked, although they had access to modern technology.
With that put in perspective, several players in the industry have also speculated that Libra might have more chances of success in developing economies, like the ones in Africa and Asia.
Another point that Maurer noted was how migrants are losing around $25 billion every year due to remittance transaction fees. Talking about his recent encounter with someone who had to pay a huge amount of money at a physical store while sending money to his family, he stated,
“As a technologist, we should be uneasy that someone has to go to a store and pay a fee to send money. Libra is trying to solve this problem by building a new global payment system powered by blockchain,” he explained.
Not so altruistic
One concern is that the altruistic notions from Libra may be a little put on as Mastercard President Ajay Banga explained when stating why they left the Association.
Part of the issue for Mastercard, according to Banga, is that the Libra project was supposed to be a globally inclusive currency that had altruistic purposes, but this quickly turned out to be a bit of a facade.
“It went from this altruistic idea into their own wallet. I’m like: ‘this doesn’t sound right,’” said Banga.
He said that financial inclusion would mean that a government is able to pay citizens in a certain currency, which they must be able to understand how to use, and must be usable in day-to-day transactions for items like food.
“If you get paid in Libra… which go into Calibras, which go back into pounds to buy rice, I don’t understand how that works,” he added.