Facebook Unveils Libra Cryptocurrency and Calibra Digital Wallet
Facebook introduces Libra, a new cryptocurrency governed by an independent association, alongside Calibra, a dedicated digital wallet for its messaging apps.
Facebook announces Libra, a new global cryptocurrency built on blockchain technology, alongside a new subsidiary called Calibra. Calibra builds a digital wallet that integrates directly into Messenger, WhatsApp, and a standalone app for iOS and Android devices. This move serves as a massive endorsement for blockchain, providing a secure and transparent ledger to enable simple global transactions.
An independent Libra Association, consisting of 28 founding organizations based in Geneva, Switzerland, oversees the new currency to ensure its legitimacy. The Libra network is backed by a reserve of real-world assets to give it intrinsic value and is scheduled to launch in 2020. The announcement boosts both Facebook's stock, which rises 4.2%, and Bitcoin, which climbs to $9,154.
Despite the financial excitement, Facebook faces significant hurdles regarding consumer trust. Users must trust the company to protect both their social data and their digital money from potential hacks, a difficult sell given Facebook's recent privacy controversies and a potential $5 billion FTC fine. The company relies on its brand recognition to legitimize cryptocurrency for everyday people who currently distrust or misunderstand the technology.