In addition to its potential to become the main existing cryptocurrency, Libra is helping blockchain adoption by opening the public debate on the opportunities, challenges, and weaknesses of technology.
With 2.34 billion monthly active users, Facebook’s ecosystem is much larger than Bitcoin’s current user base – which numbered 34 million Bitcoin wallets set up in 2018. Figures that promise to hit a rock bottom. large part of the population.
To launch this cryptocurrency, Facebook has partnered with 27 other companies.
Libra’s customer base will therefore be exponentially larger than it has partners. Indeed, these companies will promote Libra to their community, extending the reach of Libra well beyond the 2.7 billion Facebook users.
Among these partnerships we find big names such as Uber, Paypal or even Visa.
In addition to its sizable user base, Libra offers a whole range of diverse and diverse benefits, which puts it in the pole position to become the first cryptocurrency to be democratized for use on a global scale.
First, the currency is a stablecoin pegged to a basket of fiat currencies. Thus, Libra will not face the same level of price volatility as Bitcoin and other free-floating altcoins.
Second, Libra is based on a blockchain that allows 1000 transactions per second (TPS), unlike Bitcoin which only supports 7 TPS – over 100 times less than the Libra blockchain. This makes Libra much better at making and supporting ecosystem-wide payments.
Third, the members of the Libra association have the capital, the network, the lobby and the technological know-how to develop Libra internationally.
The potential of this association is enormous, which suggests that Libra could take the lead in the digital currency.
Other cryptocurrencies could also benefit from this potential democratization of use, both in B2C and B2B.
In recent years, innovation in the blockchain space has mostly been driven by startups. In the meantime, large companies have entered the market taking advantage of their financial and technological capital.
Through its conglomerate of 28 large companies, Libra is becoming one of the textbook cases. More precisely, thanks to Libra, the blockchain is finally entering the big leagues.
Yet the public sector and the business world face many challenges. As a result, the Libra debates focus on the challenges the app could pose for users and the financial system.
Political institutions and central banks have also issued a warning about the impact Libra may have on the balance of national and international financial systems. Indeed, Libra could completely shake up the monetary monopoly of the States and this fear is quite legitimate.
The central question is therefore: can we tolerate that a private company can issue a currency with international reach or should this power remain in the hands of elected officials?
Libra is based on a so-called “permission” protocol since its 100 validation nodes are managed by public entities. It will therefore be easier to coordinate and censor certain transactions by the various stakeholders. However, this allows network operators to collect user data and thus violate the confidentiality of their data.
Many issues related to blockchain technology such as bias, interoperability, and scalability, remain unanswered. These questions are today openly discussed.
This is why Libra represents an important milestone in the adoption of blockchain technology by businesses, regardless of your geographic location.
Original article by Lukas hofer published by our partner:
