As we all know, a typical cross border payment takes three-four days to complete. It costs an average of 7% to send money internationally. And 85% of global transactions use cash and US retail businesses lose about $40 billion annually due to cash theft. Targeting these real-life problems and some related problems, Facebook has launched Libra, Facebook, etc. and a cryptocurrency to be launched by 28 other founding members. This cryptocurrency which was expected to be available for use in 2020 is in the form of an open source, decentralized, programmable database built on the Libra blockchain.
What is Libra & How Does it Work?
Libra is a digital currency that allows people to buy things or send money with almost zero fees. People can buy or cash out Libra at online stores, at local exchange points, or spend it using third-party blockchain wallets such as Calibra. Payments made through Libra are written on the Libra blockchain, a decentralized public ledger designed to handle 1,000 transactions/second. If compared to existing cryptocurrencies such as Bitcoin or Ethereum, it is 7x and 15x faster respectively.
It is very easy to operate and manage the Libra Blockchain through the Libra Association. An independent, non-profit membership association headquartered in Geneva, Switzerland. The members of the Libra Association are geographically distributed, diverse businesses. The following are the members of the Libra Association:
Libra Cryptocurrency: Pros and Cons
With Libra, Facebook promises to disrupt the way mkong buys and sells things, while promoting a bankless mode of transactions. Cryptocurrencies like Ethereum and Bitcoin are not designed to be used as a medium of exchange. Their regularly fluctuating prices make it difficult for merchants to accept them as payment. This is where Libra is expected to have more potential and use cases than other cryptocurrencies.
Meanwhile, Facebook has been known to breach customer data in the past. The social media giant has already been criticized for using the digital currency to target ads and pose a risk to global banking.
If you are interested in cryptocurrencies then do share your thoughts with us in the comments below with all these questions about what is your opinion on upcoming cryptocurrencies, what do you think is the best use of Libra.