Yesterday Facebook’s Libra.org Foundation uncovered Libra, the brand-new cryptocurrency soon-to-become, as they say, a global currency for commerce and services and a new no-cost way to move the money.
Along with this announcement we knew that the new currency and its Libra Blockchain would be managed and ruled by the Libra Association among whose members are Visa, Mastercard, PayPal, Uber and others and where Facebook is represented playing a major role by Calibra, the recently created Facebook’s subsidiary.
Calibra, besides having a prominent seat in the board of directors in the Libra Association will develop Libra’s financial services and related products.
The first product Calibra intends to develop is, unsurprisingly, the Calibra app, a wallet for Libra.
“The wallet will be available in Messenger, WhatsApp and as a standalone app — and we expect to launch in 2020.”
Calibra’s wallet is their first step towards a global costless p2p money transfers
Source: Facebook’s press release.
approximately 70% of small businesses in developing countries lack access to credit and $25 billion is lost by migrants every year through remittance fees.
Currently, there are lots of almost cost-free solutions to do the same using the current cryptocurrencies, but this solution is partial. No complete solution has been created so far. There are two main problems faced by most persons when moving money using a cryptocurrency.
The first one is they need an escort to purchase coins safely. The problem with buying cryptos is that transfer of crypto-coins is irreversible while the money transfer can be reversed, creating a trust problem.
The second problem lies in that to use the money in the real-world, holders of cryptocurrencies need to exchange them and wire the funds to their bank account.
All this is inefficient and costly. From 3% to 10% of the initial money could be spent on this path on intermediary fees and wire-transfer costs.
If people can get the money without costs through smartphones and use it directly to pay for services everywhere, the circle is completed, with no need for bank accounts nor added costs.
In an interview with Coindesk, Dante Disparte, Libra Association’s head of policy and communications told “The central goal here really is financial inclusion”
Source: Calibra’s intro capture
According to a Facebook news post about Calibra, the app will have the same protections as a bank.
“Calibra will have strong protections in place to keep your money and your information safe. We’ll be using all the same verification and anti-fraud processes that banks and credit cards use, and we’ll have automated systems that will proactively monitor activity to detect and prevent fraudulent behavior.”
They are so sure of their level of protection that they will offer a refund if someone accesses fraudulently to the account. There will be, also dedicated live support for people who lose the phone or his password. The access to this app can be huge.
According to an article by businessofApps.com Whatsapp is used by 2,5 billion people and the combined usage of Facebook WhatsApp, Messenger and Instagram are 2.13 Billion users. Therefore, this live support service may become huge! Also, huge the challenges this app will face, as it will be the focus of every hacker around the globe in search of the easy money.
In Facebook’s press release announcing it, they state that Calibra will not share account information and financial data with other FB apps or third parties. They also state that the information of the account won’t be used to commercial targeting. They exceptionally will use this information to “comply with the law, mitigate risk and prevent criminal activity”.
Current Status: Still under development.