Libra Coin A Global Currency from Facebook

It was just a matter of time before hyperscalers and their own currencies, cryptocurrencies, joined the business. Under the magnifying glass, dreams of a better future and trade clash.

What if everybody was invited to access the same financial resources in the global economy? Among blockchain advocates, this thinking pushes the visionaries, not just those who choose to follow Libra.

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• Since 31% of the population of the world has to get by without a bank account. Furthermore, if they want to do foreign business, they have to consider even higher costs - the share costs about 7 percent if money has to be sent abroad.
• Nonetheless, 85 of the foreign deals are in the form of currency. And cash has other drawbacks: transporting and storing is difficult, but easy to steal. Around $40 billion annually is lost by US retailers to cash theft.
• As the poor do not have an account, they also pay $ 4 more to exchange cash every month.
• Therefore, digital financial services that are open to all could have a significant impact on the economy, especially in developing countries. The paper predicts $3.7 trillion in additional turnover and the production of 95 million jobs.
• Income capacity could be increased by 20% and extreme poverty could be decreased by 22%.

Also quickly mentioned are the prerequisites for success:

• Sending and receiving money should be easy and possible from anywhere, regardless of income. Libra requires a smartphone or data connection.
• Sending and receiving money, irrespective of income should be simple and possible from anywhere. Libra needs a link to smartphones or data.

Continuity should be maintained. For this a reserve (stablecoin) is created - this is not the case for every cryptocurrency and does not always guarantee unreserved approval.

Many of the cryptocurrencies on the market actually have no underlying assets to sustain them. The effects of Bitcoin are known to almost everyone: the value of these coins fluctuates - more than expected - just as their prices do.Since they should be able to sell a Libra Coin at any time at a value similar to the value of the corresponding reserve, this is intended to instill user faith. This is expected to safeguard Libra against speculation.

Libra users' balance sheets also decide the size of the reserve. For example, if Libra coins are purchased for EUR 100, then the EUR 100 will flow into the reserve fund controlled by the Libra Association. Libra is listed on the stock exchange as well. The exchange of coins - below or above the current value - should be possible for a small fee. How many Libra-Coins are in circulation or how many individuals want them to be sold or owned should be meaningless?

Therefore, Libra needs to resemble current currencies. The cryptocurrency could be secured by highly credit-rated government bonds. However, the inventors, using the strategies of central banks or "currency boards" forgo their own financial policy. And while central banks may print their currency at their own discretion, if enough foreign exchange markets accept the proposal to mint new coins and banknotes, a currency board typically only prints local currencies.

The Blockchain

The Libra blockchain is also a decentralized, programmable database, like other blockchain processes .

There is also a Libra blockchain development protocol, which focuses on developing a financial infrastructure that facilitates innovation, eliminates barriers to entry, and enhances access to financial services. The Libra core will be applied in advance to predict global integration and define possibilities for development in order to move the protocol.

This protocol helps many authorities - known as validators - to maintain a number of models and thus protect each other. Therefore the programming technology needed for this is used by different user accounts, which in turn have been tested by public-key cryptography. You are bound by the maker to do so. Adhere to the user-defined rules specified. The validators execute the transactions and connect with each other. This allows for a database status agreement.

The Language of the Blockchain

The transactions for Libra are based on the programming language "Move" The ability to describe user-defined resource types with semantic control through linear logic is its key feature. This helps to carry out aspects of the Libra protocol, including control of validation and processing of transactions.

In particular, it is used to describe the blockchain processes, such as the currency and membership in the validator network. These structures allow for the development of a governance structure that evolves within the first few days from the lower volatility and prestige of established institutions but can evolve over time into a totally open framework.

On the other hand, "LibraBFT" is a robust and well-organized replication system for state machines that was specifically designed for the blockchain.

It is based on the "Hotstuff" protocol, promoting scientific improvements to "Byzantine 

Fault Tolerance" (BFT) for several decades and maintaining good scalability and security.

Association & Council

The Libra Association is an autonomous association consisting of the validation nodes of the network. There are, first of all, foreign businesses, social partners, and academic institutions. Over time, any organization that operates validation nodes and has enough stakes in Libra will be included in the association.

The non-profit organization's job is to synchronize the validation nodes, to further grow the network, and to protect it. The Governance and Coordination areas include:

• The technological development, including a roadmap, inside the open-source community
• The financial security of the reserve and expenditure control for social purposes.

There were a few additional functions in the early years of the Libra Network:

• Win Founding Members Members
• Raise funds from participants and investors through the sale of Libra investment tokens
• Implementation of programmes and principles for incentives
• The distribution of dividends

If the Libra network has grown into a complete blockchain, these functions will no longer apply.

The governing body is the so-called Libra Council, made up of the members of each member of the Council. It is by voting that organizational and political decisions are made.

1. The validation nodes listed have the highest authority in the council. The council transfers much of its administrative powers to the leadership of the club, but retains the right to override delegated decisions - but a two-thirds majority is needed for the most important decisions. What choices would be taken are decided in advance. For subordinate decisions, a simple majority is necessary.
2. Preserving their worth is the key goal of maintaining reserves.
3. The weight in the council of a voting right corresponds to the respective expenditure.
4. To the world, decision making is clear.
5. Financial interest must be available in order to become a member of the council.
6. As already mentioned, the first or primary validation nodes are given by the founding members as well. To act as a node, by purchasing Libra Investment Tokens, a company should spend at least $ 10 million, as this amount is used to award one vote in the council.
7. The association's goal is to make decision-making as effective as possible and to assist its members in the execution of their decisions to the maximum extent possible.

In the course of time, the composition of the Council can and should change. The investment, the position as a verification node, and compliance with the technical regulations decide who is eligible to become a member. The speed of change is decided by the Libra Association Board, as is the development of the network and technological milestones.

Depending on the sum of Libra and their use, the node operators retain a total of 20 percent of the voting rights. Regardless of the Libra shares and the Libra they carry, with a majority of 1 percent of the votes, a single founding member can only be represented on the council. For Validation For nodes that are not charter members and have joined the network through the purchase of Libra, the cap does not apply.

 

The Founders

Stripe, Visa, Mastercard, Pago, Paypal, Marcado, PayU, as well as eBay, Booking Holdings, Facebook, Lyft, Uber Technologies, Farfetch and Iliad, Vodafone Group, but also Bison Anchorage, Coinbase, Trails, Inc., Xapo Holdings Limited and Horowitz, Breakthrough I I Limited and Horowitz is the organizations that work on concluding the statutes and that will become founding members after their completion.

Non-profit, multilateral organisations and academic institutions still exist: Creative Destruction Lab, Kiva, Mercy Corps, World Banking for Women.

Membership

There are two hosting solutions open to businesses that choose to join Libra: self-hosted and cloud service-hosted.

Self-hosted validation nodes are hosted in data centers that this member of the organization runs and manages. At least half a rack should make up the disk room. The association does not expect the space to be used immediately, and further versions of Libra Core are expected to be able to use various servers. The node also requires a high-speed and redundant Internet connection.

In addition, an engineer must take care of the software and be able to secure the validator node, such as maintaining the node's functionality and protection and protecting it from, for example, DDoS attacks, server hosting validator node attacks, and data center attacks.

The association provides organizations involved in running a validation node via a cloud service provider with the tools and documentation to facilitate the deployment. Amazon Web Services' recommended hardware is of the m5.24xlarge instance sort.

On June 18, 2019, the Libra Coins idea was proposed and could become a fact or be tradable at the beginning of 2021.

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