Facebook launches controversial cryptocurrency Libra
Published : Wednesday, 19 June, 2019 at 5:28 PM Count : 352
A controversial cryptocurrency developed by Facebook that some experts say could be used to spy on what you buy has launched today.
Facebook revealed plans for its Bitcoin-style digital money, dubbed Libra and set to launch in 2020, in a white paper sent out to investors and others.
The social network has joined forces with 28 partners in a Geneva-based entity called the Libra Association, which will govern the new digital coin.
Facebook has also created a subsidiary called Calibra, which will offer digital wallets to save, send and spend Libras.
Calibra will be connected to Facebook's messaging platforms Messenger and WhatsApp, which already boast more than a billion users.
The move is the latest development in Facebook's effort to expand beyond social networking and move into e-commerce and global payments.
The Menlo Park, California-based company has big aspirations for Libra, but consumer privacy concerns or regulatory barriers may present significant hurdles.
The digital currency will be backed by a reserve of existing currencies from around the world, likely including the US Dollar, the Euro and the Yen.
Facebook hopes it will not only power transactions between established consumers and businesses around the globe, but offer unbanked consumers access to financial services for the first time.
The name 'Libra' was inspired by Roman weight measurements, the astrological sign for justice and the French word for freedom, said David Marcus, a former PayPal executive who heads the project for Facebook.
'Freedom, justice and money, which is exactly what we're trying to do here,' he said.
Facebook also appears to be betting it can squeeze revenue out of its messaging services through transactions and payments, something that is already happening on Chinese social apps like WeChat.
The Libra announcement comes as Facebook is grappling with public backlash due to a series of scandals, and may face opposition from privacy advocates, consumer groups, regulators and lawmakers.
Some Facebook adversaries have called for the company to incur penalties, or be forcibly broken up, for mishandling user data, allowing troubling material to appear on its site and not preventing Russian interference in the 2016 presidential election through a social media disinformation campaign.
It is not clear how lawmakers or regulators will react to Facebook making a push into financial services through the largely unregulated world of cryptocurrency.
Some experts believe that the Libra coin could be used by Facebook to spy on people's purchases.
Facebook could use information about what users of the site are buying to offer better targeted adverts to attract further investment from firms.
'A better understanding of who buys what or which brands or popular could aid Facebook in ad measurement, ranking, and targeting to amplify its core business,' Josh Constine, tech expert and boss of gadget site TechCrunch, said.-daily Mail