Facebook announces Libra cryptocurrency and Calibra digital wallet, will arrive next year

Posted June 19, 2019

The social network has published a white paper explaining how Libra will work, although it won't actually launch until the first half of 2020.

"All over the world, people with less money pay more for financial services", the Libra site states, citing burdens such as steep usage fees and high-interest payday loans.

"Calibra will let you send Libra to nearly anyone with a smartphone, as easily and instantly as you might send a text message and at low to no cost", a new Facebook post explains.

Partners in the project include household names such as Mastercard, Visa, Spotify, PayPal, eBay, Uber and Vodafone, as well as venture capital firms like Andreessen Horowitz.

"Multinational corporations such as Facebook must not be allowed to operate in a regulatory nirvana when introducing virtual currencies", said Ferber.

Facebook will be just one voice among many in the association, but is separately building a digital wallet called Calibra.

Bitcoin entrepreneurs Cameron and Tyler Winklevoss signaled this week that they are ready to move past their lengthy feud with Mark Zuckerberg now that Facebook has launched its own cryptocurrency, Libra.

Facebook hopes Calibra will help those people for whom even the most basic financial services are inaccessible. Calibra will be integrated in Messenger and WhatsApp along with launching as a standalone app, and Facebook envisions a future where you'll be able to spend, send, and save Libra as easily as you would send a message to someone. But while the transaction fees using Libra will be nearly next to nothing, the Libra Association will earn interest on the money you store in Calibra or any other Libra wallet.

"It is backed by a reserve of assets that ensures utility and low volatility", Tomer said. "It is out of question" that Libra "become a sovereign currency", Le Maire said in an interview with Europe 1 radio, per Bloomberg. Like all of Libra's founding members, Facebook will get only one vote in its governing association.

Her comments came after Representative Patrick McHenry, the senior Republican on her panel, also sought a hearing on Facebook's new initiative. Described as a new digital wallet for new digital currency, the new financial service will allow consumers to keep their cryptocurrency safe, as well as make various transactions. "We also share Calibra customer data with managed vendors and service providers - including Facebook, Inc. - that support our business (e.g., to provide technical infrastructure or direct payment processing)", the company says.

Real-world currency will go into a reserve backing the digital money, the value of which will mirror stable currencies such as the U.S. dollar and the euro, according to its creators.

"If you look at the state of people using money to do bad things, most of it happens in cash", Weil said.

Most commentators were less anxious, however, and hailed Facebook's entry into the digital asset market as a key step towards legitimacy and eventually mass adoption of cryptocurrencies. Think of it as a new type of money that would be used instead of dollars.