Social media giant Facebook has finally unveiled details about its cryptocurrency project Libra. The company has just released the Libra white paper explaining the project and its testnet before a full launch in the first half of 2020.
As expected, Libra will run on its own native blockchain and will be backed by a reserve of assets that will reduce volatility. The stablecoin Libra can be stored and used from third-party wallet apps or Facebook’s own Calibra wallet that will be available within Whatsapp, Messenger and a standalone app.
Facebook has launched a new subsidiary company Calibra that will handle cryptocurrency transactions and protect user privacy by keeping Libra payments separate from Facebook data. It is good to see that the company has taken steps to address concerns around user privacy.
Interestingly, Facebook won’t have full control over the cryptocurrency project. Instead, its blockchain will be governed jointly by other companies which will become a part of the Libra Association. These companies will run validator nodes on the network which essentially means Libra will run on a permissioned blockchain system.
Companies such as Visa, Mastercard and Uber, among other giants are all part of the association and have invested $10 million into the project. Facebook plans to expand the Libra Association to 100 members by the time of the actual launch of Libra next year.
Libra uses a blockchain which is open source with an Apache 2.0 license. Developers can use it to build apps that work on the new Move programming language.
The company is also maintaining a Libra Reserve that will ensure that there is always 100% of the value of Libra in circulation collateralised with real assets. In addition, the Libra Association is also issuing its own security tokens called Libra Investment Token to fund incentive programs and cover operating costs.