Articles by "Libra"
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di September 03, 2021 0

Booming Crypto Assets, Facebook Quickly Releases Diem Digital Money

CNBC International - Facebook's plans to launch its own cryptocurrency have not died down. This intention will be realized this year after changing the name from Libra to Diem.

Reported by CNBC International, Tuesday (20/4/2021), Facebook's cryptocurrency was first introduced in June 2019 under the name libra, this digital token was originally intended as a universal currency that is used to transfer money as easily as sending a message.

But after facing strong opposition from regulators around the world, the organization overseeing the project lost key backers including Visa and Mastercard. The group eventually watered down its plan, choosing several “stablecoins” or digital money that was linked directly to official money issued by the central bank such as the US dollar and the euro.

Now known as Diem, the Facebook-backed digital coin is expected to launch later this year, albeit in a much more limited form. Diem is currently in talks with Swiss financial regulators to obtain a payments license, an important step that will put the organization further on the path towards its digital currency project.

"A big step up from our dialogue with regulators has been a phased approach to roll out," Christian Catalini, Diem's ​​chief economist, told CNBC's Joumanna Bercetche last month.

“We will be phasing out different functions and uses, applications in different areas,” he said, adding that members of these cryptocurrencies – both large and small – must undergo strict anti-money laundering checks.

However, some consultants have responded cynically to this. Given Facebook's broad reach, which had 2.8 billion monthly active users in the fourth quarter of 2020, central banks and politicians fear the currency could threaten monetary stability and potentially allow money laundering.

Facebook's involvement also means there are concerns about how Facebook will protect user privacy. “That is a tremendous challenge to the international order, because the backlash is so strong,” said Michael Casey, chief content officer of cryptocurrency media CoinDesk.

One big concern, Casey said, was that Diem was threatening the dominance of the US dollar. Two months after Facebook launched Libra, former Bank of England Governor Mark Carney proposed a new digital currency based on the global basket of goods that could reduce the dollar's status as the world's reserve currency.

Diem's ​​technology has "changed dramatically over the past year and a half from a naive blockchain to a very sophisticated blockchain that you can see trying to answer some of the questions regulators have," said Ran Goldi, CEO of Digital Assets Group, which is building the infrastructure for traders. accept diem as payment method.

Even so, there are some opinions that are optimistic about this digital currency, given its extraordinary prospects around the world.

“I think it will pass the gates this year,” said Michael Gronager, CEO of blockchain analytics firm Chainalysis. “It will be an opportunity not to be missed,” he added.

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di June 17, 2020 0

Guide for social media companies plunge into cryptocurrency

I dug into a 26-page technical document describing the protocol to be used as a platform for Facebook Libra coins (and more.) It has 53 impressive writers! Here are the details:

Abstract

The Libra protocol allows a set of replicas - referred to as validators - from different authorities to jointly maintain a database of programmable resources.

There are no mincing words here - the system will be controlled by a series of top-down authorities. However, please note that he said the database was for "programmable resources" rather than just digital currency.

This resource is owned by various user accounts that are authenticated by public key cryptography and comply with special rules specified by the developer of this resource.

The use of common words like "resources" makes me suspect that this is more than just stablecoin.

Transactions are based on predetermined contracts and, in the future, user-defined smart contracts in a new programming language called Move. We use Move to determine the core mechanisms of the blockchain, such as currency and validator membership.

Okay, now it's getting more interesting. The use of smart contract languages ​​specifically created will generate many questions about how rich the language is, and as a result, how strong the system is against conflicting contracts. There will also be questions about developer friendliness and how well Libra can protect smart contract developers from shooting themselves.

This core mechanism allows for the creation of a unique governance mechanism that builds on the stability and reputation of institutions that existed in the early days but transitioned to a fully open system over time.

It sounds like the Libra Association will become a federation that can flourish with the help of a voting system and a kind of pre-existing reputation.

1. Introduction

This ecosystem will offer a new global currency - Libra coins - which will be fully supported by a basket of high-quality bank deposits and cash from a central bank.

Libra is a generic crypto asset protocol, and the first asset is stable.

Over time, eligibility for membership will shift to being fully open and only based on ownership of Libra members.

Sounds a lot like proof of ownership. Apparently, the plan is to open membership after five years, and hopefully they will find proof of ownership at that time - although I hope they will experience the same problem as Ethereum.

The association has published a report outlining ... the road map for changes to the system without permission.

I am pretty sure this will be the first time a distributed network has gone from being allowed to without permission. It may be that the network as a whole can turn to proof of ownership, but for the stable stake / basket to be maintained, several sets of entities must keep the bridge open to the traditional financial system. This will be a persistent centralized control point through the Libra Association.

Validators take turns pushing the transaction receipt process. When the validator acts as a leader, it proposes transactions, both those that are directly submitted to him by the client and those that are indirectly conveyed through other validators, to other validators. All validators carry out transactions and form authenticated data structures that contain a new ledger history. The validator votes the authenticator for this data structure as part of the consensus protocol.

This sounds like a practical Byzantine Fault Tolerance, which is a 20-year algorithm that is well understood, although they might make some adjustments. We learn in Part 5 of the white paper called LibraBFT, which is a variant of the HotStuff consensus protocol.

As part of conducting T transactions in version i, the consensus protocol issues signatures on the full status of the database in version i - including its entire history - to authenticate responses to questions from clients.

This is important, especially because it means that the new validator must be able to join the network and synchronize quickly without having to replay the entire blockchain history, assuming that they trust the existing validator.

2. Logical Data Model

The Libra Protocol uses an account-based data model to encode the ledger status.

From a data structure perspective, Libra is more like Ethereum or Ripple than Bitcoin. The UTXO model has pros and cons - such as better privacy and stronger transaction history due to the simplicity of results-based history - but it may be more difficult to work with complicated smart contracts. Thus the account model makes sense because Facebook might not care about privacy, even though the platform sounds interested in smart contracts.

The Libra Protocol does not link accounts to real world identities. A user is free to create multiple accounts by generating multiple key pairs. Accounts controlled by the same user do not have a default link to each other. This scheme follows the example of Bitcoin and Ethereum which gives users a pseudonym.

This sounds good, but I want to know if this is also the case for Libra Coin, an asset. It would be interesting to observe how open the system is to developers who want to build applications that are more protective of privacy.

Each resource has a type declared by a module. The type of resource is a nominal type consisting of the type name and the name and address of the module that states the resource.

It looks like you can create an address, and that address can have an arbitrarily determined number of assets, as long as each asset has a unique name.

Running a transaction T results in a new ledger status of I i as well as an execution status code, gas usage, and event list.

Well, now we know how the system is protected from resource fatigue attacks, perhaps utilizing a resource cost system similar to Ethereum.

There is no transaction block concept in the history of the general ledger.

Interesting. There is no actual blockchain data structure in the Libra protocol - more blocks are virtual and logical constructs used by the validator for the purpose of coordinating confirmed snapshots of the system state. Reserving, now the first sentence of this section makes more sense:

All data in the Libra Blockchain is stored in a single versioned database. The version number is an unsigned 64-bit integer associated with the number of transactions the system has made.

Every crypto asset network that I know works the same way at a very high level: There is a system status, then the transaction is executed and is effectively a function of the transition state, and then a new system status exists.


The purpose of placing a collection of transactions into a container, or block, is for the purpose of ordering and managing their time. This is especially important with unlicensed networks, where data is authenticated via dynamic multiparty membership signatures where validators can freely join and leave the network. Because Libra operates a permitted system, Libra can use a more efficient consensus algorithm that does not need to group transactions because transaction history is much less likely to be rewritten.

In the early versions of the Libra protocol, only a small portion of the Move function was available to users. While Move is used to define core system concepts, such as Libra currency, users cannot publish special modules that state their own type of resource. This approach allows Moving languages ​​and tool chains to mature - informed by experience in implementing core system components - before being exposed to users. This approach also opposes the challenge of scalability in executing transactions and storing data inherent in general-purpose smart contract platforms.

This sounds very similar to the "open validator membership" plan referred to earlier. It seems as though Facebook hasn't solved one of the big problems Ethereum has been working on for years.

To manage demand for computing capacity, the Libra protocol imposes transaction costs, in Libra coin currency.

Libra Coins are actually the original unit of protocol, like ETH is the original Ethereum unit. This leads to another question about Libra's disguised nature: Can you get coins without AML / KYC? If not, then it looks like you won't be able to use any system functionality anonymously. From reading about the Calibra wallet, it will require AML / KYC. So I wondered if there would later be an on-ramp into a system that was not tightly controlled.

The system is designed to have low costs during normal operation, when sufficient capacity is available.

This is really vague and raises many questions: What is low cost? Is it normal operation? What is adequate capacity?

3. Conduct Transactions

Many parts of the core logic of the blockchain are defined using Moving, including reducing gas costs. To avoid circularity, the VM disables gas measurements during the implementation of these core components.

This sounds very dangerous, but the document authors note that the core components must be written defensively to prevent DoS attacks.

The main feature of Move is the ability to determine specific types of resources ... Move type systems provide special security guarantees for resources. Resources can never be copied, only moved. This guarantee is enforced statically by Move VM. This allows us to represent Libra coins as a type of resource in the Move language.

That clears the previous question whether Libra coins are genuine assets such as ETH or BTC. I hope these coins are only the default or only type of resource that will be allowed in the system when it is launched, and other resources will come later.

Stack-based bytecode steps have fewer instructions than high-level source languages. In addition, each instruction has a simple semantics that can be expressed through a small number of atomic steps. This reduces the traces of the Libra protocol specifications and makes it easier to find implementation errors.

This sounds carefully thought out; hopefully that means the security of their scripting language will be better checked than Ethereum.

4. Authenticated Data Structure and Storage

The Libra protocol uses a single Merkle tree to provide data structures that are authenticated for the history of the general ledger ... in particular, the history ledger uses the Merkle tree accumulator approach to form the Merkle tree, which also provides efficient addition operations.

Once again we see that "The Libra Blockchain" is actually not a blockchain. It is very strange that this protocol seems to be very well designed, but they still refer to it as a blockchain when the general ledger history data structure is a series of signed large countries. Validators make commitments for each ledger country, and all historical ledger countries are also committed to the Merkle tree, but I haven't really seen a list of backlinked data that forms chains - let alone block chains.

Account authentication is a hash of this serial representation.

Note that this representation requires that you recalculate the authenticator through the full account after any modifications to the account. The cost of this operation is O (n), where n is the length of the byte representation of the complete account.

Hmmm, it sounds like a gap for a DoS attack if there is no limit to the amount of data stored by the given account.

We anticipate that when the system is used, eventually storage growth associated with accounts can become a problem. Just as gas encourages responsible use of computing resources, we hope that the same rental-based mechanism may be needed for storage. We assess various approaches to rent-based mechanisms that are most suitable for ecosystems.

Another problem that has not been solved. Can't wait for "Rents are too high!" memes.

The power of choice must remain honest both during the times and for the post-era period to enable clients to synchronize to the new configuration. Clients that are offline longer than this period need to re-synchronize using several external truth sources to get checkpoints that they trust.

Ouch. It is not clear how long this "time period" is, but if the time is less than a day, then I think the "time period" is also determined. It seems that this consensus protocol is not strong enough so participants can leave and rejoin the network as they wish.

5. Byzantine Error Tolerant Consensus

LibraBFT assumes that a set of 3f + 1 votes is distributed among a set of validators that may be honest, or Byzantine. LibraBFT remains safe, preventing attacks such as double discharges and forks when most votes are controlled by Byzantine validators.

Just like PBFT, this consensus algorithm can tolerate 33% of dishonest validators. Modifying HotStuff sounds reasonable:

Hold the non-determinism bug by asking the validator to sign the block status instead of just the order of the transaction.
Pacemakers that issue explicit time limits, and validators depend on the quorum of people to move to the next round - this must increase survival.
Unpredictable leader selection mechanism to limit DoS attacks on leaders.
The aggregate signature protects the identity validator who signs the quorum certificate for selecting block acceptance.

6. Network

Each validator in the Libra protocol maintains a full membership view of the system and connects directly to the validator who needs to communicate with it. Validators that cannot be connected directly are assumed to be within the Byzantine error quota that is tolerated by the system.

It will require a lot of work to scale the system past several hundred validators.

7. Implementation of Libra Core

The security of Libra Blockchain lies in applying the validator, Move program and the correct VM Move. Resolving this issue in Libra Core is a work in progress.

Quite a bit summarize this section, even though they wrote the implementation in Rust, which seems like a good start for performance and safety.

8. Performance

We anticipate the initial launch of the Libra protocol to support 1,000 payment transactions per second with a final time of 10 seconds between the submitted and carried out transactions.

Because there will only be 100 or more validators, and they are all directly connected to each other, a 10 second block time sounds can be done.

Minimum knot requirements:

40 Mbps internet connection
CPU 1 commodity
SSD 16 TB
There are a number of previous references to maintain the validator's ability to synchronize early from scratch, instead of trusting the status signed by another validator. I hope that if Libra is widely used at all, it will quickly become very impractical to synchronize like that, and thus, the node security model will depend heavily on the validator's trust.

9. Implementing Libra Ecosystem Policy with Moves

Reserve [Libra coins] are the main mechanism for achieving value preservation. Through reserves, each coin is fully supported by a set of stable and liquid assets. Libra coin contracts allow associations to print new coins when demand increases and destroy them during demand contracts. The association does not set monetary policy. It can only print and burn coins in response to requests from authorized retailers. The user does not need to worry about associations entering inflation into the system or debating currencies: For new coins to be printed, there must be an equivalent fiat deposit in the reserve.

Okay, but now we talk about events that are outside the network. As stated earlier in the white paper, the network cannot execute scripts that use data input that is external to the network status. So the "can" and "must" modifiers in the above snippet certainly refer to the Libra Association policy or contractual obligations that are not realized by the network.

The consensus algorithm relies on the Move management validator-set management module to maintain the current validator set and manage the allocation of votes among validators. Initially, Libra Blockchain only voted for Founding Members.

Assuming that the validator chooses a change in the validator set, it seems that this produces the same problem as what we see in the proof of a long-range post-attack system. If a sufficient threshold of founding members' private keys is compromised, can an attacker write a new ledger history from scratch? If so, will the other node accept it? It is not clear whether the consensus protocol allows rewriting the old status or if it was only added.

We plan to gradually turn to proof of ownership.

If they can solve an unsolved problem.

Extraordinary Questions

How does the government work?

We can see here that the Libra Association is a member board and 2/3 supermajority is needed to make a change. They are the only ones allowed to print or destroy Libra coins, but they may be able to make whatever changes they wish if there is enough agreement.

Resources: Thoughts on Libra “Blockchain”
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di December 04, 2019 0
Frax Stablecoin.

Trump’s Former Fed Pick Stephen Moore Announces Cryptocurrency to Compete With Central Banks


The new Frax stablecoin project by the former federal reserve nominee Stephen Moore will be supported by Ralph Benko who is now a former deputy general counsel for Reagan. Economist Stephen Moore, an economic commentator and a former member of The Wall Street Journal editorial board, is planning to launch a Stablecoin dubbed Frax.

Moore is the co-founder of the new Frax stablecoin along with Sam KAzemian who also co-founded Everipedia. Benko will now be the general counsel.  Earlier this year, President Donald Trump nominated Moore to join the Federal Reserve and help manage the nation’s currency. However, the nomination fell short. On Tuesday, Moore and his partners will officially announce plans for the digital currency. It will be pegged to the U.S. dollar so its value will be more stable than other cryptocurrencies like Bitcoin.

Moreover, Stephen Moore has vocally opposed the Federal Reserve’s current plans and interest rate raises. He’s a television commentator on economic issues and also a writer for various financial media outlets. Most recently, he has been speaking on the government’s “monopoly” on the U.S. dollar. Launching a Stablecoin seems to be a logical step.

Frax is a stablecoin that is set to launch early next year which is built on a decentralized fractional reserve system which is a type of banking system where the banks can loan out customer funds and only hold a small proportion of the funds on-site for the customers to withdraw. Unlike other banks that hold fiat currencies, Frax’s reserve assets will be the Frax tokens which are a stablecoin that tracks the dollar but is not really backed by it. The protocol of the coin hopes to use existing DeFi products such as compound finance and dYdX to loan the DAI and Tether tokens as collateral and will also adjust the price of interest payments to make adjustments to the value of the currency.

The new interest payments will go back into the Frax smart contact which buys back or will rebalance the supply of Frax in the market to keep each Frax token at $1. In order to reduce further risks, Frax was previously called Decentral Bank and will not hold close to 100 percent of the funds in the reserves when it launches and will also slowly hold fewer funds in its reserves as the network becomes much more popular. Frax says that the new tokens will be held in a non-custodial manner on the blockchain making sure that the confidentiality is present over how the funds are spent. 

Unlike Facebook’s stablecoin project-Libra, the power is evenly distributed between more than twenty companies. Frax, on the other hand, is completely decentralized but the bigger goal according to Moore is to end the world’s dependence on the FED-controlled US dollar. The project is expected to make a blast on the market and there are plenty of enthusiasts that are extremely happy for the new project.

Basically, a Stablecoin is a digital currency pegged to a relatively stable asset, most of the times a fiat currency or gold. Fax may raise eyebrows in this regard, as it will depend on a fractional reserve.

Basically, Frax will rely on a fractional reserve. Fax will not be backed by a one-to-one pool of reserve dollars. Instead, Frax will rely on algorithms to loan out its reserves and collect interest, while also maintaining the value of Frax pegged to a dollar. According to the company, loans will all be recorded on Blockchain. This will eliminate the need for a central bank.

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di November 02, 2019 0
Libra vs Bitcoin.

Bank Indonesian Reveals the Difference Between Libra Crypto With Bitcoin


Bank Indonesia (BI) assesses Libra, a virtual currency (cryptocurrency) owned by Facebook Inc. different from other virtual currencies, for example, Bitcoin. Because, Libra has an asset guarantor, while Bitcoin does not.

Head of BI Macroprudential Policy Department, Juda Agung, revealed that the study of Mark Zuckerberg's currency was still being carried out by the national central bank. However, so far he said Libra was quite different from Bitcoin.

Libra has a guarantor of high-value assets, such as gold and US Treasury. In addition, there are associations that oversee in Geneva, Switzerland.

"So it is quite different between Libra and Bitcoin. We will see whether this is more like a foreign currency, like the US dollar for example," Juda said in the Thamrin region, Jakarta, Wednesday (6/26).

While Bitcoin is considered quite risky because it is not clear the guarantor (underlying) and laden with speculation elements. In addition, the limited amount also makes it easy to fluctuate prices.

Despite having a guarantor of assets, but Juda does not necessarily call Libra potentially safer than Bitcoin and other virtual currencies. Again he stressed that BI still needed time to study Libra.

"This has not yet come out, just announced (announced) the first quarter of next year will only be used," he said.

On the other hand, he again stressed that the public is not tempted to use Libra before there is an attitude from BI. Because, according to Law Number 7 of 2011 concerning Currency, the legal currency used in the country is the only rupiah.

"In essence, the legal payment instrument is the rupiah. So, outside of the rupiah, other payment instruments are not legal in Indonesia," he stressed.

Previously, Facebook announced the emergence of a crypto money provider company, Calibra. This financial service allows users to transact on cryptocurrency trading networks.

Meanwhile, Libra plans to apply globally and is supported by blockchain technology. "Libra will be available on Messenger and WhatsApp, we estimate Libra will launch in 2020," wrote a Facebook spokeswoman.

However, Chairman of the US Financial Services Committee Maxine Waters asked Facebook to stop developing Libra services. In addition, he also asked company executives to testify before the US congress.

Facebook's move to make crypto money is seen as adding to global concerns about the meaning of digital currency and data security. "Facebook has data on billions of people and has repeatedly ignored the protection and use of this data," Waters said.

In fact, the planned publication of Libra also invited anxiety on the European Continent. One of them was from the French Minister of Finance Bruno Le Maire. He said that virtual money will never replace what the government has set. He insisted again Facebook's plan to demand regulatory guarantees.

"If Facebook wants to make instruments for transactions, why not? But there is no question that this will be a sovereign currency. It cannot and should not be a sovereign currency, with all the attributes of a currency," said Le Maire.

According to him, the aspect of sovereignty must remain in the hands of the government and not private companies. There is a fear that there is a personal interest behind this project.

He stressed there needed to be a limitation so that the transaction instrument would not even finance terrorist activities or other illegal activities.

On the other hand, British central bank Governor Mark Carney said Facebook new currency must be resistant to supervision and so as not to be used for money laundering.

Resource: CNN
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di October 17, 2019 0

Libra - Regulations Can Live in Harmony


Recently we were shocked by the existence of several companies that canceled the collaboration with Libra Facebook. But this is not a blow to Libra. Libra will continue to strive towards regulation. Libra will not be launched without the supervision of appropriate regulations and handle legitimate issues. The information we got from Libra tweet "Regulations can live in harmony."

"We have said from the beginning that Libra must not and will not be launched without the supervision of appropriate regulations and handle legitimate issues. Every time someone agrees with us, it is not a" blow "or" setback. "Innovation and regulation can live in harmony "@Libra_.


This gets a tweet response from @JoeSmo05464358 "Yes, by definition" agree "with you, I don't think anyone believes it will be a 'blow' or 'setback.' Hopefully, your governance is better than your grammar lol, " said Joe Smo.



On the same occasion, Libra also received a good response from @MAEHusseini. In his Twitter response saying "You have to start by collecting various regulations related to @libra, provide economical analysis and run AI on top. Reach a general understanding, set principles, and create #Model #law that fits between different jurisdictions. " said Mehdi El Husseini (@Davidmarcus).



Karim Naufal (@mysticaltech) also added that: Well said! Keep up the good work. You are a trailblazer. Someone has to do this hard work sooner or later ... It is in the government's interest to ensure that regulated #cryptocurrency like #Libra sees the light of today, otherwise unregulated alternatives will develop!



Maybe we need to question the meaning of @mysticaltech tweet that states "unregulated alternatives will develop!". Does he mean about Bitcoin which has not been regulated by anyone?

This is different from the response given by Conner Brown. We said from the beginning that libra should be an accessible bitcoin wallet. Every time you ignore it just shows your incompetence and ignores financial freedom. Bitcoin and Facebook can live harmoniously, said @_ConnerBrown_



So what has been the response of cryptocurrency users who have been adapting so much about Bitcoin, Ethereum, XRP and other coins that have cryptocurrency without regulation?

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di September 20, 2019 0
German finance minister Olaf Scholz has responded firmly to the presence of Facebook's crypto output, Libra, Reuters reported on September 17, 2019. img/ coinone.co.id

The German Finance Minister Respond Decisively to Libra Presence

In a panel discussion held in Berlin, Olaf Scholz openly rejected the presence of Stablecoin like Libra, "We cannot accept parallel currencies," as quoted by Reuters. then

According to the order document seen by Reuters, stablecoin will not be an alternative to fiat currencies because Germany along with European and international countries will reject it.

The rejection made by the German Minister of Finance is not something new for this Facebook output stablecoin, Western European countries like France are also calling for the same thing, the French government is worried that Libra can bring "monetary sovereignty" to European countries, Express.co. uk

Libra is a stable coin that will run in a blockchain network that is secured by 100 distributed computer servers or nodes. To create an open and interoperable financial services ecosystem and to expand inclusion

Stablecoin is a cryptocurrency created to have a stable value based on the value of goods such as the United States dollar, gold, and others.

Strong response to Libra

In addition, the head of Libra development David Marcus also received a strong response about the crypto that wants to be released from the United States senators at a parliamentary meeting held last July.

An American Senator named Sherrod Brown started the discussion about Facebook which he considered "dangerous" and also was not worthy of trust by Americans. The scathing response that was brought up continued to offend the privacy of Facebook user data on errors that had occurred. "Facebook has shown scandal after scandal that it is not appropriate for us to believe," Brown.then said

But David Marcus denied the problem that had happened to Facebook when it was associated with political problems. He explained that Facebook had also tried to fix the problem

Marcus also opened his voice regarding the planned launch of Libra at the hearing session that the Stablecoin did not intend to replace the existing fiat currency. He will only launch Libra when the related regulations are completed and have received the green light from the authorities and regulators

Source: blog.coinone.co.id
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di September 13, 2019 0
Libra Facebook.

Bitcoin Scaling Issues Forcing Facebook to Make Libra.


Libra exists due to the presence of Bitcoin. As much as it proved by itself since Satoshi's creation laid the foundation for each crypto asset that was followed. The extent to which Bitcoin is responsible for spawning Facebook's currency has now been made very clear in an interview with Abra's Bill Barhydt. The investment platform CEO claims that Facebook wants to integrate BTC directly into its billions of powerful social networks - but was forced to create Libra instead because of Bitcoin's inability to scale.

How is the Inability of Bitcoin to Weigh Libra Projects Issued

On the What Bitcoin Did podcast last week, host Peter McCormack entertained Bill Barhydt of Abra, who revealed insider knowledge about the development decisions that guided Project Libra. Before Facebook went ahead with plans to create a stable currency, Facebook had explored the possibility of integrating Bitcoin, Barhydt claims. The plan is to activate BTC as a payment option in the entire Facebook ecosystem.

"Ideally, from my discussion, [Facebook] actually prefers using Bitcoin. I think there are people who really believe in this system, "ventured Barhydt. The idea of   Facebook supporting BTC in the world's largest social network, and it's likely that the second and seventh largest (Instagram and Whatsapp) might seem strange, and we might not be never known for sure whether this was the original plan, but Bill Barhydt was well connected, and so his comments were quite influential, when he told Peter McCormack:
If you want to build a money transfer system and you want to build a cross-border trading system and you have 1.2 billion users today, what will happen to Bitcoin? Costs will skyrocket. Doing anything with Bitcoin that is transactional effectively cannot be maintained.
LIBRA DEEP DIVE

Why Bitcoin Will Not Scale

Facebook embraces Bitcoin, regardless of what people think about the tech giant, it will be very bullish for BTC and for the cryptosphere as a whole. The 1.2 billion people who are introduced to healthy money, even in a clean Facebook walled environment, will be huge. That did not happen, due to the inability of Bitcoin to support the number of transactions that could potentially flow through the network as a result.

The inability of Bitcoin to scale has certainly been a matter of intense debate in the community for years, causing deep cracks and resulting in permanent divisions that occurred when Bitcoin Cash was cut in mid-2017. BCH supporters have long accused the developers of Bitcoin Core, led by Blockstream loyalists, who do not want to substantially increase the block size to allow more transactions per second (tps). Since increasing the block size to four times the BTC, BCH can theoretically process around 100 tps, and offer transaction costs that are currently 113X cheaper.

Increasing block size is a simple but effective scaling solution that has allowed Bitcoin Cash to process hundreds of thousands of transactions a day on a test - more than enough to absorb the demands of large companies like Facebook that are entering into a fuss, for example. Critics will note that there are limits on expanding block size, beyond that centralization occurs because of the difficulty of users being able to run nodes to verify transactions independently. The sweet spot beyond the unwanted need to continue to increase the block's capacity blindly is a matter of debate. What is clear, however, is that the decision by Bitcoin Core developers and their helpers to keep the BTC blocks as small as possible has pushed businesses away from Bitcoin and reduced merchant adoption.

Adoption of Emptiness

Instead of scaling Bitcoin, Core supporters have pushed the layer two solutions they are very proud of, Lightning Network, to take the burden. But there is a problem with that approach: Lightning is still not ready for production, and maybe years away from being suitable for company adoption. Only last month, a critical bug was discovered in the protocol, considered so severe that it wasn't even revealed until all nodes had the opportunity to update to patched software. The incompatibility of Bitcoin as a payment system, coupled with the Lightning mismatch for almost anything other than buying stickers, has led to an adoption vacuum. Businesses, including Facebook, if Abra's CEO wants to be trusted, wants to use the network but can't do it.

'These are smart - people,' said Barhydt from the Facebook blockchain team. "They have seen Lighting, they have seen Bitcoin, they have thought about this. And they came to the conclusion that Bitcoin is not optimized to be a payment network, Bitcoin is optimized to be digital money now. "Proponents of Bitcoin Cash will agree that BTC is not optimized to function as a payment network, but will refuse at the time. Suggestions that it is capable of functioning as digital cash now - it is a use case that BCH is currently fulfilling more successfully.

Even with larger block size, there may be technical or other regulatory obstacles that prevent Facebook from using BTC. What can be stated with certainty, is that the inability of Bitcoin to scale, coupled with the complexity of Lightning, and the security issues and UX that accompany it, has created a perfect storm. Into this vortex eye has stepped on the Libra Project, the biggest demonstration yet of what happened when the P2P payment network stopped functioning as digital money.

Do you think Facebook is seriously considering using Bitcoin? Let us know in the comments section below.

Source: Bitcoin.com
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di September 12, 2019 0
Libra Facebook

Facebook Inc. plans to launch a digital currency (cryptocurrency) named Libra.


The launch of this digital currency has expanded the Facebook business network not only to social networks but also extends to e-commerce and digital payments at the global level.

The company has been connected with 28 partners based in Geneva, Switzerland called the Libra Association. The presence of this association will regulate the work of new digital coins which will be launched in the first half of 2020, according to executives.

Facebook has also created a subsidiary called Calibra, which will offer digital wallets for storing, sending and offering Libra.

Later Calibra will be connected to the Facebook Messenger and WhatsApp platforms which now have one billion users.

The company, based in Menlo Park, California, has high hopes for Libra, but is still hampered by privacy protection policies and personal data that consumers can stumbling block in the future.

However, the company founded by Mark Zuckerberg has an ambition that Libra is not only strengthens electronic transactions between upper middle class consumers and global business networks, but also offers consumers untouched access to banking finance.

The use of the Libra name itself was inspired by heavy gauges in Roman times, as a sign of astrology to symbolize justice and freedom, according to former PayPal executive David Marcus who led the Facebook project.

"Freedom, justice and money, that's exactly what we are trying to do here," Marcus said, as reported by Reuters on Tuesday (6/18).

To launch this digital currency, Facebook must be willing to reach deeper pockets so that it drains revenue from Facebook instant messaging application.

This is a consequence that has already happened to Chinese social applications such as WeChat.

Facebook executives claim to have reported to regulators in the United States and abroad regarding the launch of this cryptocurrency.

Unfortunately they did not want to specify what regulators or institutions to apply for the financial permit.

Facebook Blockchain Product Vice President Kevin Weil hopes that global regulators can approve this plan so that this product can be widely marketed.

"This gives us the basis to go on and have productive conversations with regulators around the world. We really want to do that," Weil said.

The launch of Libra comes when Facebook is struggling in a number of scandals, so they must face the problem of protecting privacy and personal data of users, policy regulators and members of parliament.

Some opponents of Facebook even called the company to be punished or broken down by force due to errors in handling user data.

In addition, Facebook is considered unable to filter hoax information in the 2019 American elections allegedly conducted by Russia.

The question will arise how the parliament or regulator's reaction to Facebook plan to enter the world of cryptocurrency is currently not officially regulated.

Moreover, in recent years, cryptocurrency investors have lost hundreds of millions of dollars as a result of hackers and the market has also been plagued by allegations of money laundering, drug sales and terrorist funding.

Source: tribunnews.com/bisnis/
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