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Facebook urged to pause Libra crypto-currency project

107 points by headalgorithm 7y ago

tjpnz 7y ago
>If Libra wants to be a big player in the UK's payments system it will have to be regulated by the Financial Conduct Authority and show that it knows who its customers are and that it has strong anti-money-laundering controls. Existing money-transfer firms say complying with all the rules can be an onerous and expensive business. Similar deal in Japan. They'll need to ensure nobody using it is in a gang, is a terrorist or might be politically exposed. In a lot of cases they'll be required to collect identity documents. They'll also need to cease offering service to any flagged individual across their entire platform.
- H8crilA 7y ago
  That's no big deal really. USDC does that: https://support.usdc.circle.com/hc/en-us/articles/360016060352-Can-a-customer-send-USDC-tokens-to-any-address-Can-addresses-be-blacklisted- https://support.usdc.circle.com/hc/en-us/articles/3600160603... And it should be easy to implement in a private consensus blockchain.
- dexen 7y ago
  >In a lot of cases they'll be required to collect identity documents. This may very well be the major reason for Facebook to introduce & maintain the cryptocurrency. The "real name" policies were tried across the social media, with the expectations of both higher civility, and also faster, more complete build-up of personal data gathering/social graph build-out for advertising etc. The policies failed for obvious reasons. However if Facebook was legally mandated to obtain & keep personal identification data due to handling of the cryptocurrency, and also at the same time able to track transaction of the users, it would have an unprecedented look into even more connections between people. Tracking money shows business connections, family connections (think allowance for kids, gifts, etc.), and also social connections (think hanging out with friends, splitting bills with Venmo, etc.).
  - YawningAngel 7y ago
    That's never going to fly in the EU, the regular will simply insist that they keep all such data entirely separate, even if that's very impractical for them to do.
    - dexen 7y ago
      ...after 5 years of hand-wringing and investigations. By which time Facebook would have had made out like mad bandits. Plus they really can white-wash the data; as per the announcements, not only Facebook but also other major entities would hold the ledger. You can easily imagine Facebook buying (or getting for a nominal $1) processed data from the other entities. No user data would change hands, "merely" well trained AI models.
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- buboard 7y ago
  I remember a lot of crypto exchanges require photo of passport / id card. This is not new
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stakhanov 7y ago
...that point where the policymakers realize "Oops this cryptocurrency stuff is not going away on its own". Next step: Pass some laws to shut it all down. (EDIT: To be clear, I don't agree with this, but this is what's going to happen).
- supermatt 7y ago
  It being crypotocurrency isnt the issue here. The problem is that this isn't the same as a proof of work system - it is proof of stake - with the "burden" of proof put on facebook and its partners. This means that they can simply "create" currency with no oversight or proof of reserve. In short, it works EXACTLY like a central bank, but it's not regulated. This is extremely dangerous for consumers.
  - stakhanov 7y ago
    My point is: The trend in financial services and payment systems regulation is going in the complete opposite direction of the kind of features that would make crypto interesting. Decentralization, Anonymization, etc are all things that the policymaker has been actively working to combat.
    - supermatt 7y ago
      This isn't decentralized (its overseen by facebook and partners). It's not anonymous either (in order to participate in the network you need identification). This is a bank, albeit using the cryptocurrency label to pretend it doesn't need regulation.
      - vageli 7y ago
        This is _exactly_ the point stakhanov is making.
        supermatt 7y ago
        I dont read it as that. > "Oops this cryptocurrency stuff is not going away on its own". Next step: Pass some laws to shut it all down. > Decentralization, Anonymization, etc are all things that the policymaker has been actively working to combat. The reason policymakers should want to regulate this is because it is a bank - not because its decentralized or anonymized (because its not)
docdeek 7y ago
Honest question: how is this different to a website having a means for users to buy tokens, and then either give those tokens to another person on the site or trade them with another user? I can buy reddit gold and then gift that gold to someone who amuses me with a comment or a post, and the only difference I’m seeing is that reddit keeps my money and only gifts virtual gold to the funny guy. Is the only difference with Facebook’s Libra that when I give the Libra to someone else they can cash it our for ‘real’ money? Apologies for the question if I am missing something obvious.
- madamelic 7y ago
  The intention of cryptocurrency is the public ledger ("blockchain"). Rather than relying on Reddit, for instance, to determine who owns what, everyone can check the blockchain to see for themselves. The public ledger means that Reddit doesn't (in theory) control the ledger. Reddit couldn't go in and delete coins or give coins without payment. Reddit could have a large stash of coins though and be willing to buy and sell coins though. Libra though is kind of really weird. It is a "decentralized" system but really the decentralization is just putting it in the hands of a small group. That isn't totally a bad thing, but it definitely isn't a great thing. Look at 51% attacks, that is why having a small group of large holders is a really bad idea. On the other side though, the large holders are well-known so at least everyone would know for sure who is pushing around the network.
  - supermatt 7y ago
    > The public ledger means that Reddit doesn't (in theory) control the ledger. Reddit couldn't go in and delete coins or give coins without payment. Actually, there would be nothing stopping them giving coins without payment. The ledger cant record that payment was received in order to mint some coins, it would just record that coins were minted. Thats what scary about this whole situation. They could mint extra "funds", and as long as user deposits are greater than what they "spend", you would never know.
    - mikekchar 7y ago
digitalengineer 7y ago
Are they afraid? What happens the next time the pound takes a massive tumble down (again) during a Brexit like event? People might decide to convert their money from pounds to Libra's. The Libra is based on a basket of currency's, much like the SDR governments use. It's potentially MORE stable than the pound. https://en.wikipedia.org/wiki/Special_drawing_rights https://en.wikipedia.org/wiki/Special_drawing_rights
- CaptainZapp 7y ago
  Why would they convert into a currency owned and controlled by a private company? A private company proven not to really care about morals? While it could absolutely be that the £ tumbles there are a number of stable currencies in which £ could be exchanged if people are worried that it loses value (that's value in relation to other currencies). ¨ The concept is called FOREX[1] and is not exactly new or revolutionary. [1] https://en.wikipedia.org/wiki/Foreign_exchange_market https://en.wikipedia.org/wiki/Foreign_exchange_market edit : wrong word
  - digitalengineer 7y ago
    > Why would they convert into a currency owned and controlled by a private company Because if a bank runs the risk of failing (like BOTH of mine did in Holland) people freak out. Their bank accounts are suddenly a liability. If there is a fast and easy way to transfer money out of the banks, that would be a big plus. Even if you were to purchase dollars, they would still sit on your bank account.
    - CaptainZapp 7y ago
      And if there's any trouble with "cash" issued by a private company: Best of luck getting help from their "customer support". At least a bank is regulated and holdings are insured up to a certain amount.
    - gjulianm 7y ago
      > Because if a bank runs the risk of failing (like BOTH of mine did in Holland) people freak out Most EU countries have had deposit guarantees for a while (even before the crisis). It's an EU-wide rule since 2014 [0]. Would FB have that? Doubtful, as the deposit guarentees are provided by the governments that are in control of the currency. > If there is a fast and easy way to transfer money out of the banks What bank do you use that does not allow you to withdraw money? 0: https://ec.europa.eu/info/business-economy-euro/banking-and-finance/financial-supervision-and-risk-management/managing-risks-banks-and-financial-institutions/deposit-guarantee-schemes_en https://ec.europa.eu/info/business-economy-euro/banking-and-...
r3bl 7y ago
Conspiracy theory time: Facebook knows they can't do this legally across the world. They're announcing it beforehand in an attempt to get permissions in like 10 jurisdictions tops, with a soft deadline that's going to be used as an excuse to get those permissions as soon as they can (or, at least, faster than they would otherwise). For the other 200ish jurisdictions, they won't bother. Why act proactively when they can launch a currency, hope that it catches on, and then act re-actively once other jurisdictions with less power catch on to what's happening. Western governments will get what they want before the projects kicks off, and everyone else... well, who gives a shit about everyone else? Certainly not Facebook's shareholders.
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- threeseed 7y ago
  That’s not a conspiracy theory. It’s a proven business model. Look at Uber, AirBnb, Lime etc. They were launched illegally in many countries.
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- chii 7y ago
  but to play the devil's advocate, why should a service which proportedly offer a benefit to the user of that service be disallowed to be offered? If a country's citizens chose to use libra, it must be because they found it useful, and the country should not have permission to prevent it. If it was exploitative, then presumably the users would not choose to use libra.
  - jacobush 7y ago
    Oh, only non exploiting business models ever get chosen. (Taking notes.)
gjulianm 7y ago
I get the impression from the article that no lawmakers had knowledge of the protocol. I hope Facebook does not plan to introduce this "sneakily" without taking into account laws and the financial issues this can introduce. Honestly, I really hope this project is stopped as soon as possible. Facebook already has way too much influence in our lives. It controls news, messaging and relationships with others, and it has not been managing them in a responsible way. Why would anyone let this company control money too? What happens if Facebook causes a financial crisis? Who will be controlling them? Who will they be accountable to? What happens if Facebook goes bankrupt? Libra is a project with way too much risk for the benefits it offers.
- gtirloni 7y ago
  You don't have to use Libra, or Bitcoin, or Ether, or...
  - gjulianm 7y ago
    This is not another app. This is Facebook saying that they want to create a widespread currency, not just a payment system. And I don't need to use it to become affected by the monetary policy of the behemoth that Libra could become.
    - buboard 7y ago
      Ah, not in my backyard
      - gjulianm 7y ago
        Do you care to expand?
        buboard 7y ago
        People having terrible economic backyards may want to move near you. Yet you say they should be stopped because they ll ruin your view. [it doesnt have to be facebook's currency, any cryptocurrency could have major monetary policy implications]
seibelj 7y ago
A week ago every blockchain and cryptocurrency article on HN was full of comments declaring the whole technology a huge ponzi scam that only con-artists and idiots used ("look at this NIST blockchain workflow [smug face]"[0]). Now blockchain is the most powerful monetary technology ever created and governments and regulators must put a stop to it immediately! It's incredible what can change in a week. [0] https://i.redd.it/uu0qg8t28tq11.png https://i.redd.it/uu0qg8t28tq11.png
- supermatt 7y ago
  This isn't a "blockchain" discussion, this is a discussion about an application of blockchain. It's clear that this isn't just a cryptocurrency, but a bank using the cryptocurrency label to avoid regulation - thats why it needs to be stopped. You should read the comments in this and the announcement article (still on front page since yesterday) as it seems you are confused.
  - seibelj 7y ago
    A week ago the pitchfork commenters would say anyone that uses blockchain is clearly an idiot because a centralized database is superior in every way. Suddenly everyone is agreeing that blockchain technology has value! I’m just so shocked
    - icebraining 7y ago
      Your shock comes from the misconception that the two are incompatible. The crucial point here is that FB is creating a currency they control. It can still be true that FB are idiots for using a blockchain instead of a database.
    - Lewton 7y ago
      The other thread is full of people lambasting Facebook for using a blockchain when it’s not really needed since it’s a centralized currency in practice
    - snarf21 7y ago
ralphstodomingo 7y ago
Look, it does not matter to me whether this uses blockchain or not. Such discussion won't even be productive. Facebook has not been the best steward for its main feature the News Feed, leading to fake news, mass misinformation, not to mention their heavy use of psychology to keep people hooked. I refuse to trust them something similar won't happen with Libra.
- chris_wot 7y ago
  This. Currencies only work if people have confidence in them. They also need to have confidence in the institution backing them. In no way should anyone have any confidence in Facebook. On top of this, in most economies, deposit taking institutions are backed by Reserve Banks. Facebook could die in 20 years. Do we want to trust it will still exist? If it collapses can you recover your money? There are so many issues, they haven’t even come close to addressing even a small portion of them. Caveat emptor!
Mengkudulangsat 7y ago
Why would the US be against this? The current US dollar holds power globally largely thanks to the oil trade. As the world moves away from oil, surely you'll need a replacement reason for us to keep wanting the US dollar? Libra would be a geopolitical coup.
- jkoudys 7y ago
  I agree with all of that, but still have fear about how unhinged the us could become in that scenario. No matter how unhealthy, uneducated, disrespectful of the judiciary & rule of law, and xenophobic the population grows, the government has always valued stability. A big part of that is the USD's place as the defacto world-currency, stabilised by its place in the global energy sector. Even when I haven't liked where they were headed, I've always felt like America had a steady hand on the wheel. For the first time in my life I feel like that may change.
buboard 7y ago
This is not the first cryptocoin, or stablecoin or anything that has not been released before. It's hard to take these reactions as anything other than politicians grandstanding for popularity points.
- tzs 7y ago
  Do any of those released before, even in their wildest dreams, have a chance of being as widely used and having as big an impact on ordinary people as Libra? Facebook is not attracting political and regulatory attention not because what they are doing is new, but rather because they have a realistic chance of doing it on a much larger scale than we've seen so far.
  - buboard 7y ago
    Bitcoin was supposed to have dominated the world by now. Apple pay could potentially be in 1.4 billion devices. Google pay could potentially be in 2.5 billion devices. I dont remember much political theater when these were rolled out, that's why i believe this is just posturing.
swarnie_ 7y ago
Considering Facebook is either dead or dying in the tech savey under 40 market who is this aimed at? How many 55 year old boomers are going to exchange their known fiat currency for magic Facebook bucks? Also any note yet or the scope of this? Will it be pushed to Instagram and what ever other garbage Facebook peddle?
- snarf21 7y ago
  This is all about exploiting the unbanked and the migrants/illegals that send cross border payments home. This is why Visa and PayPal are involved too, they want a piece of that pie as well. This is FB seeing how well WeChat has done with payments and going after Africa and South America since Asia has already been won. They have said this will be available in Messenger and WhatsApp.
- malvosenior 7y ago
  You're aware that Facebook owns Instagram and Whatsapp right? It's by far the number one social networking company for people under 40.
  - jkoudys 7y ago
    and if you're only looking at the people around you in your own country, that can undersell their influence even more. The entirety of India runs on WhatsApp these days. I was in Cartagena earlier this year, and even their taxi cab dispatch was running on it.
  - swarnie_ 7y ago
    > Will it be pushed to Instagram and what ever other garbage Facebook peddle? I literally reference them owning Instagram in my post, Whatsapp i forgot about admittedly/
drc37 7y ago
If Maxine Waters is against it then it is probably a good thing. And why is one Facebook even batting an eye at one lawmaker?
- PretzelFisch 7y ago
  It's both Republican and Democrat calling for this holt and testimony. https://www.nationalmortgagenews.com/news/maxine-waters-calls-for-halt-to-facebooks-cryptocurrency-plans?utm_campaign=alert-c-Jun%2019%202019&utm_medium=email&utm_source=newsletter&eid=12a6d4d069cd56cfddaa391c24eb7042 https://www.nationalmortgagenews.com/news/maxine-waters-call...
adwww 7y ago
It is amusing watching big US tech giants trying to launch payment platforms to solve problems the rest of the world has forgotten about. > “In time, we hope to offer additional services for people and businesses, such as paying bills with the push of a button, buying a cup of coffee with the scan of a code or riding your local public transit without needing to carry cash or a metro pass,” You can instantly and securely send up to £100,000 for free between any UK banks, and contactless payments are EVERYWHERE here - I've even seen a begger with a chip and pin machine - let alone paying for coffee or a bus fare without cash.
- kaolti 7y ago
  Judging from the photos used on the libra.org website they're targeting a very different audience.
  - scottlocklin 7y ago
    Yep, they're going after Wave. Not a bad idea; Africa has decent growth potential, and it's not clear what wave's penetration is (most Africans I've met use it).
  - snarf21 7y ago
    Like you said, this is all about exploiting the unbanked and the migrants/illegals that send cross border payments home. This is why Visa and PayPal are involved too, they want a piece of that pie as well.
- threeseed 7y ago
  You do know that most of the world isn’t like the UK. Money transfers between countries in particular poorer ones is absolutely not a solved problem. Neither is accepting money for products/services in countries where not everyone has a bank account or a credit card. And there is rampant corruption in many places as well. Even a handful of these are enough to make the effort a success.
  - dagw 7y ago
trpc 7y ago
Even though I hate Facebook, but most politicians do such things only to get featured in the news. They neither understand nor even care about what they are talking about.
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koonsolo 7y ago
Let's face it: the traditional world is shitting their pants. The disruption of 'money' was already on the table with all the cryptocurrencies. And now powerhouses such as Facebook, Visa and MasterCard, Uber and Lyft, eBay, and Spotify stand behind this new Libra. I would shit my pants too.
morsmodr 7y ago
Until tech firms start taking responsibility of ensuring that their platforms are robust and cannot be misused, I am not convinced of Libra. Putting the blame on people using the technology is incredibly naive on their part, frankly because it is human nature to exploit something. They need to start operating from a position of 'how can this be misused' not from a position of 'let's make this cool thing and expect some ideal world out there to embrace it and then think about problems as they arise'. And this is just 1 part of it, the other part is assurances that this data will not be used to further interests of all the validators. I am curious on what is the value proposition pitched by FB to attract validators, besides what is given on the public facing websites. The fact that you have government institutions is to have a body that is removed from profit making goals, and thinks about the society in the long term. Sure, there are corrupt politicians, but not all of them are. Europe seems to have the right mind with regards to tech firms. What is it that fb and other investors look to get out of this thing?

107 points by headalgorithm 7y ago

>If Libra wants to be a big player in the UK's payments system it will have to be regulated by the Financial Conduct Authority and show that it knows who its customers are and that it has strong anti-money-laundering controls. Existing money-transfer firms say complying with all the rules can be an onerous and expensive business. Similar deal in Japan. They'll need to ensure nobody using it is in a gang, is a terrorist or might be politically exposed. In a lot of cases they'll be required to collect identity documents. They'll also need to cease offering service to any flagged individual across their entire platform.

H8crilA 7y ago
That's no big deal really. USDC does that: https://support.usdc.circle.com/hc/en-us/articles/360016060352-Can-a-customer-send-USDC-tokens-to-any-address-Can-addresses-be-blacklisted- https://support.usdc.circle.com/hc/en-us/articles/3600160603... And it should be easy to implement in a private consensus blockchain.
dexen 7y ago
>In a lot of cases they'll be required to collect identity documents. This may very well be the major reason for Facebook to introduce & maintain the cryptocurrency. The "real name" policies were tried across the social media, with the expectations of both higher civility, and also faster, more complete build-up of personal data gathering/social graph build-out for advertising etc. The policies failed for obvious reasons. However if Facebook was legally mandated to obtain & keep personal identification data due to handling of the cryptocurrency, and also at the same time able to track transaction of the users, it would have an unprecedented look into even more connections between people. Tracking money shows business connections, family connections (think allowance for kids, gifts, etc.), and also social connections (think hanging out with friends, splitting bills with Venmo, etc.).
- YawningAngel 7y ago
  That's never going to fly in the EU, the regular will simply insist that they keep all such data entirely separate, even if that's very impractical for them to do.
  - dexen 7y ago
    ...after 5 years of hand-wringing and investigations. By which time Facebook would have had made out like mad bandits. Plus they really can white-wash the data; as per the announcements, not only Facebook but also other major entities would hold the ledger. You can easily imagine Facebook buying (or getting for a nominal $1) processed data from the other entities. No user data would change hands, "merely" well trained AI models.
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buboard 7y ago
I remember a lot of crypto exchanges require photo of passport / id card. This is not new

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stakhanov 7y ago

...that point where the policymakers realize "Oops this cryptocurrency stuff is not going away on its own". Next step: Pass some laws to shut it all down. (EDIT: To be clear, I don't agree with this, but this is what's going to happen).

supermatt 7y ago
It being crypotocurrency isnt the issue here. The problem is that this isn't the same as a proof of work system - it is proof of stake - with the "burden" of proof put on facebook and its partners. This means that they can simply "create" currency with no oversight or proof of reserve. In short, it works EXACTLY like a central bank, but it's not regulated. This is extremely dangerous for consumers.
- stakhanov 7y ago
  My point is: The trend in financial services and payment systems regulation is going in the complete opposite direction of the kind of features that would make crypto interesting. Decentralization, Anonymization, etc are all things that the policymaker has been actively working to combat.
  - supermatt 7y ago
    This isn't decentralized (its overseen by facebook and partners). It's not anonymous either (in order to participate in the network you need identification). This is a bank, albeit using the cryptocurrency label to pretend it doesn't need regulation.
    - vageli 7y ago
      This is _exactly_ the point stakhanov is making.
      - supermatt 7y ago
        I dont read it as that. > "Oops this cryptocurrency stuff is not going away on its own". Next step: Pass some laws to shut it all down. > Decentralization, Anonymization, etc are all things that the policymaker has been actively working to combat. The reason policymakers should want to regulate this is because it is a bank - not because its decentralized or anonymized (because its not)

docdeek 7y ago

Honest question: how is this different to a website having a means for users to buy tokens, and then either give those tokens to another person on the site or trade them with another user? I can buy reddit gold and then gift that gold to someone who amuses me with a comment or a post, and the only difference I’m seeing is that reddit keeps my money and only gifts virtual gold to the funny guy. Is the only difference with Facebook’s Libra that when I give the Libra to someone else they can cash it our for ‘real’ money? Apologies for the question if I am missing something obvious.

madamelic 7y ago
The intention of cryptocurrency is the public ledger ("blockchain"). Rather than relying on Reddit, for instance, to determine who owns what, everyone can check the blockchain to see for themselves. The public ledger means that Reddit doesn't (in theory) control the ledger. Reddit couldn't go in and delete coins or give coins without payment. Reddit could have a large stash of coins though and be willing to buy and sell coins though. Libra though is kind of really weird. It is a "decentralized" system but really the decentralization is just putting it in the hands of a small group. That isn't totally a bad thing, but it definitely isn't a great thing. Look at 51% attacks, that is why having a small group of large holders is a really bad idea. On the other side though, the large holders are well-known so at least everyone would know for sure who is pushing around the network.
- supermatt 7y ago
  > The public ledger means that Reddit doesn't (in theory) control the ledger. Reddit couldn't go in and delete coins or give coins without payment. Actually, there would be nothing stopping them giving coins without payment. The ledger cant record that payment was received in order to mint some coins, it would just record that coins were minted. Thats what scary about this whole situation. They could mint extra "funds", and as long as user deposits are greater than what they "spend", you would never know.
  - mikekchar 7y ago

digitalengineer 7y ago

Are they afraid? What happens the next time the pound takes a massive tumble down (again) during a Brexit like event? People might decide to convert their money from pounds to Libra's. The Libra is based on a basket of currency's, much like the SDR governments use. It's potentially MORE stable than the pound. https://en.wikipedia.org/wiki/Special_drawing_rights https://en.wikipedia.org/wiki/Special_drawing_rights

CaptainZapp 7y ago
Why would they convert into a currency owned and controlled by a private company? A private company proven not to really care about morals? While it could absolutely be that the £ tumbles there are a number of stable currencies in which £ could be exchanged if people are worried that it loses value (that's value in relation to other currencies). ¨ The concept is called FOREX[1] and is not exactly new or revolutionary. [1] https://en.wikipedia.org/wiki/Foreign_exchange_market https://en.wikipedia.org/wiki/Foreign_exchange_market edit : wrong word
- digitalengineer 7y ago
  > Why would they convert into a currency owned and controlled by a private company Because if a bank runs the risk of failing (like BOTH of mine did in Holland) people freak out. Their bank accounts are suddenly a liability. If there is a fast and easy way to transfer money out of the banks, that would be a big plus. Even if you were to purchase dollars, they would still sit on your bank account.
  - CaptainZapp 7y ago
    And if there's any trouble with "cash" issued by a private company: Best of luck getting help from their "customer support". At least a bank is regulated and holdings are insured up to a certain amount.
  - gjulianm 7y ago
    > Because if a bank runs the risk of failing (like BOTH of mine did in Holland) people freak out Most EU countries have had deposit guarantees for a while (even before the crisis). It's an EU-wide rule since 2014 [0]. Would FB have that? Doubtful, as the deposit guarentees are provided by the governments that are in control of the currency. > If there is a fast and easy way to transfer money out of the banks What bank do you use that does not allow you to withdraw money? 0: https://ec.europa.eu/info/business-economy-euro/banking-and-finance/financial-supervision-and-risk-management/managing-risks-banks-and-financial-institutions/deposit-guarantee-schemes_en https://ec.europa.eu/info/business-economy-euro/banking-and-...

r3bl 7y ago

Conspiracy theory time: Facebook knows they can't do this legally across the world. They're announcing it beforehand in an attempt to get permissions in like 10 jurisdictions tops, with a soft deadline that's going to be used as an excuse to get those permissions as soon as they can (or, at least, faster than they would otherwise). For the other 200ish jurisdictions, they won't bother. Why act proactively when they can launch a currency, hope that it catches on, and then act re-actively once other jurisdictions with less power catch on to what's happening. Western governments will get what they want before the projects kicks off, and everyone else... well, who gives a shit about everyone else? Certainly not Facebook's shareholders.

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threeseed 7y ago
That’s not a conspiracy theory. It’s a proven business model. Look at Uber, AirBnb, Lime etc. They were launched illegally in many countries.
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chii 7y ago
but to play the devil's advocate, why should a service which proportedly offer a benefit to the user of that service be disallowed to be offered? If a country's citizens chose to use libra, it must be because they found it useful, and the country should not have permission to prevent it. If it was exploitative, then presumably the users would not choose to use libra.
- jacobush 7y ago
  Oh, only non exploiting business models ever get chosen. (Taking notes.)

gjulianm 7y ago

I get the impression from the article that no lawmakers had knowledge of the protocol. I hope Facebook does not plan to introduce this "sneakily" without taking into account laws and the financial issues this can introduce. Honestly, I really hope this project is stopped as soon as possible. Facebook already has way too much influence in our lives. It controls news, messaging and relationships with others, and it has not been managing them in a responsible way. Why would anyone let this company control money too? What happens if Facebook causes a financial crisis? Who will be controlling them? Who will they be accountable to? What happens if Facebook goes bankrupt? Libra is a project with way too much risk for the benefits it offers.

gtirloni 7y ago
You don't have to use Libra, or Bitcoin, or Ether, or...
- gjulianm 7y ago
  This is not another app. This is Facebook saying that they want to create a widespread currency, not just a payment system. And I don't need to use it to become affected by the monetary policy of the behemoth that Libra could become.
  - buboard 7y ago
    Ah, not in my backyard
    - gjulianm 7y ago
      Do you care to expand?
      - buboard 7y ago
        People having terrible economic backyards may want to move near you. Yet you say they should be stopped because they ll ruin your view. [it doesnt have to be facebook's currency, any cryptocurrency could have major monetary policy implications]

seibelj 7y ago

A week ago every blockchain and cryptocurrency article on HN was full of comments declaring the whole technology a huge ponzi scam that only con-artists and idiots used ("look at this NIST blockchain workflow [smug face]"[0]). Now blockchain is the most powerful monetary technology ever created and governments and regulators must put a stop to it immediately! It's incredible what can change in a week. [0] https://i.redd.it/uu0qg8t28tq11.png https://i.redd.it/uu0qg8t28tq11.png

supermatt 7y ago
This isn't a "blockchain" discussion, this is a discussion about an application of blockchain. It's clear that this isn't just a cryptocurrency, but a bank using the cryptocurrency label to avoid regulation - thats why it needs to be stopped. You should read the comments in this and the announcement article (still on front page since yesterday) as it seems you are confused.
- seibelj 7y ago
  A week ago the pitchfork commenters would say anyone that uses blockchain is clearly an idiot because a centralized database is superior in every way. Suddenly everyone is agreeing that blockchain technology has value! I’m just so shocked
  - icebraining 7y ago
    Your shock comes from the misconception that the two are incompatible. The crucial point here is that FB is creating a currency they control. It can still be true that FB are idiots for using a blockchain instead of a database.
  - Lewton 7y ago
    The other thread is full of people lambasting Facebook for using a blockchain when it’s not really needed since it’s a centralized currency in practice
  - snarf21 7y ago

ralphstodomingo 7y ago

Look, it does not matter to me whether this uses blockchain or not. Such discussion won't even be productive. Facebook has not been the best steward for its main feature the News Feed, leading to fake news, mass misinformation, not to mention their heavy use of psychology to keep people hooked. I refuse to trust them something similar won't happen with Libra.

chris_wot 7y ago
This. Currencies only work if people have confidence in them. They also need to have confidence in the institution backing them. In no way should anyone have any confidence in Facebook. On top of this, in most economies, deposit taking institutions are backed by Reserve Banks. Facebook could die in 20 years. Do we want to trust it will still exist? If it collapses can you recover your money? There are so many issues, they haven’t even come close to addressing even a small portion of them. Caveat emptor!

Mengkudulangsat 7y ago

Why would the US be against this? The current US dollar holds power globally largely thanks to the oil trade. As the world moves away from oil, surely you'll need a replacement reason for us to keep wanting the US dollar? Libra would be a geopolitical coup.

jkoudys 7y ago
I agree with all of that, but still have fear about how unhinged the us could become in that scenario. No matter how unhealthy, uneducated, disrespectful of the judiciary & rule of law, and xenophobic the population grows, the government has always valued stability. A big part of that is the USD's place as the defacto world-currency, stabilised by its place in the global energy sector. Even when I haven't liked where they were headed, I've always felt like America had a steady hand on the wheel. For the first time in my life I feel like that may change.

buboard 7y ago

This is not the first cryptocoin, or stablecoin or anything that has not been released before. It's hard to take these reactions as anything other than politicians grandstanding for popularity points.

tzs 7y ago
Do any of those released before, even in their wildest dreams, have a chance of being as widely used and having as big an impact on ordinary people as Libra? Facebook is not attracting political and regulatory attention not because what they are doing is new, but rather because they have a realistic chance of doing it on a much larger scale than we've seen so far.
- buboard 7y ago
  Bitcoin was supposed to have dominated the world by now. Apple pay could potentially be in 1.4 billion devices. Google pay could potentially be in 2.5 billion devices. I dont remember much political theater when these were rolled out, that's why i believe this is just posturing.

swarnie_ 7y ago

Considering Facebook is either dead or dying in the tech savey under 40 market who is this aimed at? How many 55 year old boomers are going to exchange their known fiat currency for magic Facebook bucks? Also any note yet or the scope of this? Will it be pushed to Instagram and what ever other garbage Facebook peddle?

snarf21 7y ago
This is all about exploiting the unbanked and the migrants/illegals that send cross border payments home. This is why Visa and PayPal are involved too, they want a piece of that pie as well. This is FB seeing how well WeChat has done with payments and going after Africa and South America since Asia has already been won. They have said this will be available in Messenger and WhatsApp.
malvosenior 7y ago
You're aware that Facebook owns Instagram and Whatsapp right? It's by far the number one social networking company for people under 40.
- jkoudys 7y ago
  and if you're only looking at the people around you in your own country, that can undersell their influence even more. The entirety of India runs on WhatsApp these days. I was in Cartagena earlier this year, and even their taxi cab dispatch was running on it.
- swarnie_ 7y ago
  > Will it be pushed to Instagram and what ever other garbage Facebook peddle? I literally reference them owning Instagram in my post, Whatsapp i forgot about admittedly/

drc37 7y ago

If Maxine Waters is against it then it is probably a good thing. And why is one Facebook even batting an eye at one lawmaker?

PretzelFisch 7y ago
It's both Republican and Democrat calling for this holt and testimony. https://www.nationalmortgagenews.com/news/maxine-waters-calls-for-halt-to-facebooks-cryptocurrency-plans?utm_campaign=alert-c-Jun%2019%202019&utm_medium=email&utm_source=newsletter&eid=12a6d4d069cd56cfddaa391c24eb7042 https://www.nationalmortgagenews.com/news/maxine-waters-call...

adwww 7y ago

It is amusing watching big US tech giants trying to launch payment platforms to solve problems the rest of the world has forgotten about. > “In time, we hope to offer additional services for people and businesses, such as paying bills with the push of a button, buying a cup of coffee with the scan of a code or riding your local public transit without needing to carry cash or a metro pass,” You can instantly and securely send up to £100,000 for free between any UK banks, and contactless payments are EVERYWHERE here - I've even seen a begger with a chip and pin machine - let alone paying for coffee or a bus fare without cash.

kaolti 7y ago
Judging from the photos used on the libra.org website they're targeting a very different audience.
- scottlocklin 7y ago
  Yep, they're going after Wave. Not a bad idea; Africa has decent growth potential, and it's not clear what wave's penetration is (most Africans I've met use it).
- snarf21 7y ago
  Like you said, this is all about exploiting the unbanked and the migrants/illegals that send cross border payments home. This is why Visa and PayPal are involved too, they want a piece of that pie as well.
threeseed 7y ago
You do know that most of the world isn’t like the UK. Money transfers between countries in particular poorer ones is absolutely not a solved problem. Neither is accepting money for products/services in countries where not everyone has a bank account or a credit card. And there is rampant corruption in many places as well. Even a handful of these are enough to make the effort a success.
- dagw 7y ago

trpc 7y ago

Even though I hate Facebook, but most politicians do such things only to get featured in the news. They neither understand nor even care about what they are talking about.

deleted 7y ago

[deleted]

koonsolo 7y ago

Let's face it: the traditional world is shitting their pants. The disruption of 'money' was already on the table with all the cryptocurrencies. And now powerhouses such as Facebook, Visa and MasterCard, Uber and Lyft, eBay, and Spotify stand behind this new Libra. I would shit my pants too.

morsmodr 7y ago

Until tech firms start taking responsibility of ensuring that their platforms are robust and cannot be misused, I am not convinced of Libra. Putting the blame on people using the technology is incredibly naive on their part, frankly because it is human nature to exploit something. They need to start operating from a position of 'how can this be misused' not from a position of 'let's make this cool thing and expect some ideal world out there to embrace it and then think about problems as they arise'. And this is just 1 part of it, the other part is assurances that this data will not be used to further interests of all the validators. I am curious on what is the value proposition pitched by FB to attract validators, besides what is given on the public facing websites. The fact that you have government institutions is to have a body that is removed from profit making goals, and thinks about the society in the long term. Sure, there are corrupt politicians, but not all of them are. Europe seems to have the right mind with regards to tech firms. What is it that fb and other investors look to get out of this thing?