Facebook may be able to buy off US regulators, but they won’t be able to convince the EU.
On the other hand I think you are right. I expect any US based opposition to move swiftly. Regulations should probably be the least of their concern given how the US has treated entire Nation States trying to move away from US dollar denominated Oil trade. It will be interesting to see what the equivalent of a no-flight zone, arming militants and sending “advisors” will be.
I wouldn't be so sure that Uncle Sam wasn't in on it in the first place. The potential military, economic, and intelligence value of this thing should be self evident.
Now them having a cryptocurrency is alarming. Why does it really need to do this? There is nothing anonymous about facebook. Whatever transaction is done, will be linked to your account.
This is dangerous.
Whether they start or not is irrelevant, as informed users, we must spread word in our circle to avoid such cryptocurrency like the plague.
It will no longer be sufficient to try to prevent FB from going ahead with this plan, because they will, if not now, after a few months or years from now. The only thing that will prevent this from wreaking havoc in the world is to spread awareness of how bad this is and how much more power it will give to FB.
I am genuinely surprised people would allow a company collecting data to be their financial provider.
This is mostly contrary to the idea behind bitcoin to have a decentralized currency beyond anyone's control. The unholy alliance between facebook, ebay, visa and mastercard is certainly no advantage to the user.
But I am afraid convenience will bite us in the ass again.
More than that though, AML/KYC and any other checks deemed necessary can occur at almost every point of contact with fiat currencies.
https://libra.org/en-US/compliance-consumer-protection/#over...
One thing is that countries may be cut off from swift. That limits money transfer in and out of the country but the bank transfers within the country would still work. Blocking this could potentially halt the internal money transfers of a country.
Facebook has many users. Each Bitcoin marketplace has only few.
So.. no reliable way to actually get your monopoly money into USD? at least they don't falsely claim to have the USD sitting in a bank, that's a start i guess.
Can't find the source but it was reliable, Techcrunch or the New York Times I think
Since Facebook has a dominant social app and messaging app position worldwide, their payments service will have worldwide penetration from day one. Since Facebook can do software, the service interface will be more convenient and user friendly that existing services in the first world, and infinitely more so elsewhere. Money can be made here and evidence suggests people want to adopt when there is a no effort road to adoption. There are vested interests to deal with and satisfy on the road to market penetration, existing market players and governments, but American entrepreneurs like Gates and Jobs were able to overcome vested interests in their time and I suspect Mark is equally resourceful when he wants to be.
I am a cautiously optimistic person, but this is giving me the jeepers. I can't quite put my finger on it, but it doesn't feel right.
This is very unlikely, in places with social unrest people get forced to go to bank withdraw cash, or even as far as sale goods to make the cash for gangster, making it digital will make zero difference.
> more lending because of deposits
Lending by who? what deposits? lending most of all depends on risk which requires a stable society and some resemblance of an economic system and policy.
When a county doesn't receive tax it will be a very big problem.
So countries need to be in control of the flow of money.
It is also a very big problem is an outsider can change the value of your own currency. So you don't want US companies taking over your money flow.
I know this is open ups the whole discussion about cryptocurrenies all over again, but maybe some people don't want government to have the monopoly on storing and transferring 'money'.
Unfortunately the reality of being "unbanked" is that government regulations will still put up a barrier. KYC laws require "necessary documentation" which these big providers won't be able to get past. Local options may still be better in these cases.
For example, people who were born stateless may not be able to easily acquire KYC documentation. They may not have documentation of being born. Being locked out of ID options puts a limitation on getting past KYC.
In the Philippines, there are mobile options where you can deal with small amounts of money without having to verify your identity. These options are run by the major telco's here.
The point here is: people who are used to Internet and the way things work here can't understand the old-fashioned companies.
Why sending money overseas cost such enormous amounts of money? Why bank fees are so difficult to understand? Why there is fee when moving money within the same bank, when we all know that it is simple transaction in the database?
And maybe the Russian government doesn't want ordinary citizens to move money outside the country
They only lack of the extra-territoriality for their offices :)
I've lived in China and seen how this plays out. Facebook's new Libra Blockchain will be a centralized bank but way more dangerous.
It will allow for a worldwide social credit system. If Facebook decides to remove you for wrong speak or wrong think, your money and many services will be inaccessible.
Further, they have no mandate like the central bank does to increase employment. Their mandate is to make money for corporations. This will lead to global social unrest.
This will put some third-world countries in complete control by Facebook. I mean, whoever runs the currency, is the country. But in this case, it will be completely controlled, as it's also many of those countries main source of communication. Therefore, if Facebook's Libra is a countries main currency and social network, that country will be owned by Facebook.
Finally, the regulations on crypto and blockchain are still new. This is in Facebook's advantage as they can start lobbying to have these laws in their favor. They can argue for less transparency, as they are a bank, and this fits with their new privacy marketing message.
This is extremely subversive and Europe is already rightly pushing back. America will be next. On one hand, I love seeing the existing financial system panic when new technology comes out. On the other hand, under no circumstances will I accept a world where Facebook started the one world currency.
Btw, Libra is not a blockchain, but a distributed database. Think of it as Visa, Mastercard and friends coming together to create one database that they can update individually yet have the changes available to everyone while maintaining data integrity. Much better than the existing "black box" system, the new system is easier to audit.
How is this different than what we have today with banks and credit card companies? The government can already freeze your funds. And now there are examples of people being censored online by being dropped by PayPal, which sets a scary precedent no matter how terrible their beliefs are.
>Further, they have no mandate like the central bank does to increase employment. Their mandate is to make money for corporations. This will lead to global social unrest.
That made me chuckle. The Fed has shown no concern for those who save by keeping interest rates so dangerously low for so long. The Fed is also here to make money for huge banks and corporations by making credit so cheap. In the long run this may not be the best for employment. Even if it is, it won't be for wages and wealth disparity.
>This will put some third-world countries in complete control by Facebook. I mean, whoever runs the currency, is the country.
Not much different than the role USD and the Euro play in developing nations today.
>Finally, the regulations on crypto and blockchain are still new. This is in Facebook's advantage as they can start lobbying to have these laws in their favor. They can argue for less transparency, as they are a bank, and this fits with their new privacy marketing message.
And what laws does Facebook plan to propose that are worse than the regulation (or lack thereof) that exists for the financial industry today?
>On the other hand, under no circumstances will I accept a world where Facebook started the one world currency.
I agree. I hope it is not Facebook that wins this game. But your other comments are very reactionary.
It is not just a new style of credit card. And while it will act like a bank, it appears it will dodge regulation and consumer protection (limited as it is) under the word "cryptocurrency" or some other neologism poorly understood by the public and legislators.
Will Libra deposits be covered under FDIC? Will it be subject to closures when there is a panic? What rights do depositors have in the event of wrongful transactions?
So it's great if it allows people under repressive or kleptocratic governments more security and freedom. It's fine if it's just a toy to send money to friends. But it's another thing if it's just a bank with an unstated "depositor beware" philosophy. It'd also be a lot less worrisome if the company implementing it had a bit better reputation.
There is no such thing as a dangerously low interest rate. The atmosphere won't suddenly catch on fire if you don't get a certain percent of risk free money. Additionally, "those who save" is not part of their mandate. They target unemployment and inflation.
>The Fed is also here to make money for huge banks and corporations by making credit so cheap.
Cheap credit isn't good banks anymore than it's good for individuals. Low interest means low mortgages, etc. If it's good for businesses, it's good for people for the same reason.
>In the long run this may not be the best for employment.
There hasn't been evidence otherwise so far. There has been plenty of evidence of money shortages causing lots of unemployment (see all busts of the early 1900s).
>Even if it is, it won't be for wages and wealth disparity.
High interest is absolutely terrible for wealth disparity. It's literally free money for people with money.
Every attempt Facebook has made at commerce has failed miserably. No one trusts Facebook enough to purchase on Facebook, let alone use a Facebook currency.
Facebook, Snapchat, Twitter, et al. have all tried over and over again to get people to transact on their platform. Shop on Facebook, Buy on Twitter, Snapcash have all failed. Shopping on Instagram is a failure in progress.
All these companies want to feel like they are more influential than they are. They are really good at getting people to waste their time. Money, not so much.
I live in the "third world". People are not so discriminatory or probing about FB and friends as the west. In fact,(and regretfully), I daresay FB is viewed positively.
So don't be too sure.
It is the same as people deciding not to vote and then realizing that the wrong candidate had won with devastating consequences.
Hey there, Republic of Ireland would like to have a word with you :)
Its a way for companies to capitalize on the cryptocurrency hype, without, ultimately, acting like a real cryptocurrency. Its going to be a giant bank that has government law enforcement and intelligence agencies as its clients and patrons.
This is sponsored by Visa and others. They are co-opting "cryptocurrency" for their own purposes. The goal is for this to become mainstream before real cryptocurrencies and take over before they can really get going for mainstream payments.
I filed a bug report. https://github.com/libra/libra/issues/41
I will probably make another issue that is just depressing and concrete about the project and features no characters but it will be easier for people to ignore.
