The Libra coin news recently are surrounded by a lot of scrutiny, mainly coming from regulators but also from backers such as Mastercard, Visa and as of recently PayPal, which decided to exit the project before its 2020 launch. However, in the meantime, around 30 different blockchain companies and nonprofits plan to initiate a new Libra fork which could lead the Facebook-led crypto project to building its own permissionless version dubbed OpenLibra.
All of this was announced in the ETH news first – and at the Ethereum developer conference Devcon organized by Lucas Geiger (co-founder of the blockchain infrastructure startup Wireline). As he said, OpenLibra will function as a stablecoin pegged to the actual Libra cryptocurrency.
The new Libra fork will apparently come in time as the stablecoin is already scheduled to go live late next year, Geiger said, adding:
“We’re going to fork the code, fork the community and create a new cryptocurrency called OpenLibra,” said Geiger during his presentation at Devcon. “There is no token sale. No equity and no company behind this initiative.”
If you are following the Libra latest news, it is wise to know that OpenLibra’s core team includes representatives from major blockchain projects such as Cosmos, Chainlink, Web3, Democracy Earth and others – as well as non-profit organizations such as the Danish Red Cross.
Geiger also explained that there is a “generous grant” from the Interchain Foundation that will support OpenLibra and the research around it – as well as the personal funds. The Interchain Foundation is a non-profit organization dedicated to supporting the cosmos network development.
“This covers our funding for several months but there are other grants coming in,” Geiger said.
Facebook first unveiled Libra in June and detailed that it is a stablecoin which will be pegged to a basket of fiat currencies as well as government bonds. The new Libra fork and OpenLibra project expects to improve many things, after publishing a permissionless version of the Libra virtual machine on GitHub called “MoveMint” and running atop of the Tendermint blockchain software designed for use on public blockchain platforms such as Cosmos.
“Anything running on Facebook’s Libra, you can just drag and drop to OpenLibra. Finances will work the same. The code will work the same,” Geiger concluded.
Shopify Joined The Libra Association As Many Giants Leave
“As online commerce becomes increasingly borderless, it’s easy to forget that payments and the value exchange of goods are not a solved problem everywhere,” stated the firm.Having in mind the inability of the existing world financial infrastructure to comprehend the scale of internet commerce, the firm concentrated on digital assets to assist the growth of its platform. Joining the Libra Association is only one of the measures Shopify will be taking in order to position itself as a solution to this worldwide problem. But with companies like Visa, MasterCard, Stripe, PayPal and eBay leaving the Libra Association, the decision of Shopify to join the group was met with criticism and mystification. The future of the Libra project is still unknown because many of the governments around the globe worry about the potential consequences on the global financial system that can come from Libra. The CEO of Shopify, Tobi Lutke, defended the decision of the company to join the disintegrating association, stating that the future of the project is what drew them to it.
“We like to make decisions based on future potential instead of heard movement. Funnily enough, this usually leads to us doing the opposite of the others.’’Tobi Lutke also stated that the firm will start accepting Bitcoin (BTC) directly if there is significant buyer demand. Shopify at this moment supports crypto payments through the merchant payment solution of Coinbase, Coinbase Commerce. Through the integration, millions of shoppers and merchants will have the opportunity to pay and get paid in Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Bitcoin Cash (BCH) and Dai.
Calibra Lead Explains Why Facebook Built New Language For Libra
“Move is a new smart contract language built into the core of Libra that is designed to bring a modern approach to today’s financial systems.”Maurer also mentioned that Libra's mission is to solve the lack of access to financial services. He noted that even 1.7 billion adults globally are unbanked, yet 1 billion of those individuals have mobile phones. The Calibra lead also spoke about migrants and how they lose $25 billion a year due to remittance transaction fees. He explained that he recently spoke with someone who had to go to a physical store and pay a fee in order to send money to their family:
“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.”According to Maurer who is a Calibra lead, Libra offers unique advantage to users and developers which is direct access to its platform, creating an inclusive financial system for all:
With Libra, users don’t have to rely on intermediaries to store funds. Libra offers direct access to the platform and creates a more inclusive system. Developers can also access the platform and build applications to help provide services for people not included in today’s financial system.”Maurer also explained that the idea was to build a language which is designed to fit with the paradigms used when programming with money. He was featured in the altcoin news for describing Libra as a stablecoin that is focused on payments and financial use cases for consumers.
"When building Move, we focused on creating a safe, flexible language that allows us to express concepts that are easily tweakable and easy to analyze for financial use cases," he concluded.
EU Does Not Know What To Do With Facebook’s Libra Coin
“I actually don’t know if Libra is going to work.”Government bodies in the United States and EU are right now working on better understanding crypto. Meanwhile, 2020 is proving to be a great time for cryptocurrencies not only because of their surge but also because of their acceptance. As all of this is happening, the Commission launched an open public consultation which will be available until March 19th, while the Internal Revenue Service (IRS) in the United States is preparing for a cryptocurrency summit which is expected to take place on March 3rd this year. All in all, Libra is creating problems for regulators and no one knows how its future will unfold. From a regulatory perspective, Libra is not the only stablecoin but is certainly one which could become the most popular one.
Mastercard Left Libra Over Regulatory And Viability Concerns: CEO
“It went from this altruistic idea into their own wallet. I’m like: ‘this doesn’t sound right,’" Banga told the news.Mastercard left Libra because of reasons which are now emerging. According to Banga, 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 such as food.
"If you get paid in Libra [coin] . . . which go into Calibras, which go back into pounds to buy rice, I don’t understand how that works," he said.The cryptocurrency news today also show that a lack of a clear business model for Libra is what raised another red flag for Mastercard. The Libra coin news before showed that Mastercard was not the only one leaving the stablecoin project - firms like Visa and PayPal did the same at the same period.
"When you don’t understand how money gets made, it gets made in ways you don’t like," the CEO of Mastercard said.Once Mastercard left Libra, the company started investigating the potential use of the project. Banga appeared to have concerns when association members would also not firmly commit to the controls of data management including the know-your-customer (KYC) and anti-money laundering (AML) legislation. Visa, on the other hand, had pulled out because the project had not been able to "satisfy all requisite regulatory expectations" as a spokesperson later confirmed. Out of the 28 founding members of the Libra project, eight have left. The British telecom conglomerate Vodafone was the last leaving in January 2020 when it decided to focus on its own digital payments service. As Mastercard left Libra, the payments giant adopted a very cautious approach to distributed ledger technology.
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