Editor's Note: This article comes fromEditor's Note: This article comes from(ID: quantumschoo), Author: Luo Jinhai, reproduced by Odaily with authorization.
facebook wants"issue coins"
The world is changing too fast, and today Facebook officially announced the issuance of coins.
At 17:00 on June 18, 2019, Beijing time, Libra Network (Libra Network), a subsidiary of Facebook in Switzerland, joined forces with 26 companies around the world to release a white paper on the cryptocurrency project. The official name of the cryptocurrency is Libra (Libra).
The first sentence of the white paper is: Libra's mission is to build a simple, borderless currency and financial infrastructure that serves billions of people.
Without any ambiguity, Libra is to build a "borderless currency", which is Facebook's goal.
Libra anchors a "basket of currencies" composed of multinational legal currencies, which is defined as a "stable currency" in the blockchain world. Libra originally had another name, GlobalCoin, which translates to "global currency". But the mature and prudent Zuckerberg finally chose the symbolic name Libra, trying to downplay the "ambitious ambition" of the name GlobalCoin.
The world's largest social platform accesses "stable currency", what does Facebook's action mean?
It means that 2.7 billion users will access the cryptocurrency payment system;
3/4 of the Internet population enters the blockchain world;
Hayek's "Denationalization of Money" will be verified by reality;
The battlefield of technology giants has expanded from user flow to the financial world;
…………
what is
what is"stable currency"？
stable currency
What are stablecoins? What are stablecoins worth? Why did Facebook issue a stable currency?
As a cryptocurrency that uses blockchain technology to issue assets linked to legal tender world assets (such as gold, silver, US dollars, etc.), contrary to other highly unstable cryptocurrencies (such as Bitcoin, Ethereum, EOS), stablecoins will try their best to Keep volatility low.
Stable currency is a "bridge" between the cryptocurrency and the legal currency world, and has the following specific values:
❶ The appearance of encrypted payment currency
The first contradiction of cryptocurrencies is the contradiction between the appreciation of the local currency and the payment of the local currency. The emergence of stable coins has solved this contradiction and is of great help to the circulation of cryptocurrencies.
❷ Digital storage of real assets
There are many ways to anchor stablecoin assets. Gold, silver, U.S. dollars, power, credit, securities, and fixed assets can all be anchors. Libra is anchoring the credit assets accumulated by Facebook over the years. The digital counterpart of 2.7 billion stable users in the cryptocurrency world.
❸ Stable ecological value exchange
As an Internet giant, Facebook’s issuance of “stable currency” is an inevitable choice. It is different from self-made “bachelors” such as Bitcoin who rely on appreciation to obtain scattered users. It is the “constant value” that the top rich in the real world need. Its core functions are divided into three layers: the first is to digitize existing assets; the second is to obtain residual value in the flow of digital assets; the third is to create a digital value exchange system.
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Libra's ambitions and struggles
There were three options for Facebook to issue "Libra stable currency":
Option 1: 1:1 peg to USD.
Option 2: Link with the US dollar, euro, yen and other currencies, formulate a "basket" plan, and reserve the above three currencies at the same time in the company's international account where the stable currency is linked, and finally move towards the form of a fund.
Option 3: A mixture of credit currency and mortgage currency. The value is generated through "behavioral mining + user recharge". The legal currency of the user's own country is mortgaged.
The first option is obviously the safest option, and there are already legal precedents. In September 2018, the U.S. government approved two stable currencies, Gemini Dollar and Paxos Standard, with 1 token exchangeable for 1 USD. If Facebook adopts this method, it will be bound to the U.S. dollar. It will become the most powerful pioneer in the digitization of the U.S. dollar, and the interests of the two are the same.
The third solution is the blockchain strategy of many Internet companies, also known as the TOKENization of the pass-through economy. It adopts the lowest cost method to gradually tokenize Internet assets. It's this routine.
The second option is essentially the most difficult, because it means being ready to become a "world currency" from the very beginning, to become the leader of the blockchain world, and to compete with the traditional fiat currency world.
Facebook is almost invincible in the Internet world, and Zuckerberg can lay out the blockchain steadily, becoming the "ultimate predator" among conservative forces. But he chose the second option. Why did he move forward in such a radical way?
Active reason: This is Facebook’s pre-emptive and one-stop strategy in the blockchain world. Unlike the traditional world, there is only one unified currency in the digital world. Whoever occupies the first place in the world will have the Matthew effect. It is difficult for some digital currencies to reach the blue sky. This is Facebook's "ambition".
Since Facebook was founded, it has been invincible in the Internet world. The social business model developed by Zuckerberg is also the most viable and excellent product. The success of the Internet world has fueled Zuckerberg’s ambition. He wants to take a step from the Internet. Blockchain in place.
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❸ Lead the operation of Libra with the governance model of the foundation;
❶Establish a stable blockchain ecosystem;
❷Promote alliance establishment in a decentralized way;
❸ Lead the operation of Libra with the governance model of the foundation;
❹ Combined with the POS mechanism of the blockchain to share benefits.
❹ Combined with the POS mechanism of the blockchain to share benefits.
Facebook has attracted more than 20 companies around the world to cooperate from the beginning, distributed in blockchain, investment institutions, shared travel, payment, e-commerce, social media, telecommunications and many other fields. Here are the first organizations (by industry) that are among the “founders” announced in the white paper:
• Payments: Mastercard, PayPal, PayU (Naspers' fintech arm), Stripe, Visa
• Technology and Exchange Platforms: Booking Holdings, eBay, Facebook/Calibra, Farfetch, Lyft, MercadUber Technologies, Inc.
• Telecommunications: Iliad, Vodafone Group
• Blockchain Industry: Anchorage, Bison Trails, Coinbase, Inc., Xapo Holdings Limited
• Venture capital: Andreessen Horowitz, Breakthrough Initiatives, Ribbit CapitaUnion Square Ventures
• Nonprofits, multilateral organizations, and academic institutions: Creative Destruction Lab, Kiva, Mercy Corps, Wom
At the same time as vertical and horizontal, Facebook has begun to encrypt its own products:
❶Apply its stable currency to its three major communication/social tools: WhatsApp, Facebook Messenger, and Instagram;
❷ Integrate the Libra stable currency into its core advertising system to reward users for their creation, sharing, and dissemination. Users can also purchase its products through Facebook's stable currency;
❸Libra will also be used for actual payments. Facebook has been negotiating with Visa, MasterCard. Negotiations include the application of Libra to financial information service company First Data and some e-commerce platforms;
❹Facebook allows internal employees of the Libra project to receive the cryptocurrency as salary.
Going it alone is not the value of the blockchain, and only by sharing benefits with all participants can it go further.
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Facebook’s currency issuance could have been regulated by the New York Department of Financial Services (NYDFS) like GUSD, anchored to the US dollar at 1:1, but it is anchored to a “basket of currencies”.
Anchoring a "basket of currencies" means not anchoring any single legal currency, it anchors itself.
The Libra Network could have been registered in the United States, but in the end it chose Switzerland.
Choosing this world-famous neutral country as the first base of their business is obviously aimed at globalization.
Facebook is not reconciled to being a pawn of American finance, but wants to lay another chess game outside the existing "dollar hegemony".
"U.S. dollar hegemony" may have the following means to counter Libra:
"U.S. dollar hegemony" may have the following means to counter Libra:
❶ Use legal means to suppress stablecoins outside the "dollar system".
In April 2019, the legal department in New York launched an attack on Bitfinex, an American company that owns the world's largest stablecoin USDT, and froze $850 million of Bitfinex. Although USDT is anchored to the US dollar at 1:1, it is not regulated by the US financial sector, and the current Libra also belongs to this stable currency.
❷ Incorporate stablecoins into the financial system and become part of the digital dollar.
In September 2018, the New York Department of Financial Services (NYDFS) authorized Gemini Trust, a digital currency exchange, and Paxos Trust, a blockchain start-up, to issue cryptocurrencies with stable prices, strict 1:1 pegs to the U.S. dollar, and all issued Currency behavior is regulated by the government, which is the most popular way for the US financial sector.
❸ Establish mechanisms in the existing financial system to control cryptocurrencies.
On June 13, 2019, Bakkt, a subsidiary of Intercontinental Exchange Group, the parent company of the New York Stock Exchange, announced that it will begin testing bitcoin futures products on July 22.
❹ Cultivate competitors to check and balance Libra.
This is a legal means of a market-oriented country, such as JPMorgan Chase’s stablecoin MJ coin that supports the payment system in the international traditional financial field, or encourages companies such as Google and Apple to embed their own cryptocurrencies from the bottom.
❺ Issue the national digital currency of the United States.
❺ Issue the national digital currency of the United States.
For the United States, if the stable currency of the cryptocurrency industry is not under the control of the financial system, it will eventually no longer need power and dollar endorsement, just like the decoupling of the dollar from gold in 1971, and eventually become a worldwide digital currency. This is territory the Fed and Wall Street will not relinquish under any circumstances. Although Libra is full of ambitions, there is still a long way to go.
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Libra vs. Bitcoin, Internet vs. Blockchain?
Although Bitcoin has reached a market value of 1 trillion yuan today, it still pales in comparison to Facebook.
In 2018, Facebook’s net profit was as high as US$25 billion, the number of users was 2.7 billion, and its market value exceeded US$500 billion. With the world’s largest user group and inexhaustible cash, it stands at the highest point in the Internet world.
Libra has 2.7 billion users from the beginning, compared with Bitcoin's 10 million users, it is not at the same level at all.
When Libra meets Bitcoin, what kind of sparks will eventually collide between the two?
Libra is a product of the Internet world, it is an eagle flying on the World Wide Web;
Bitcoin is the original species of the blockchain, it is a night owl sneaking in the gray world;
Now this eagle wants to invade the gray world, can it eventually become the ruler of this world, or is it just the eagle eye of the night owl exploring the gray world?
The blockchain world doesn't think Libra will be a success. Although Libra's grand plan is a bit shocking, in the cryptocurrency world, which is currently at the grassroots stage, the bigger the company wants to come in and usurp the role of the central bank, the more it will be fatally suppressed.
After all, it is still an era of guerrilla warfare, and there is no need for a behemoth like Libra to launch the "three major battles".
These reasons for supporting Bitcoin against Libra are as follows:
❶The Libra launched by Facebook is just a token, which is not fundamentally different from the JPMcoin launched by JPMorgan Chase. It just adds a new competitor, and its actual effect is still unknown.
❷The "network stable currency" supported and fully anchored by legal currency, no matter how the design changes, can only be a special token running on a specific network platform, and it is impossible to replace or subvert legal currency.
❸Libra is linked to a basket of currencies, which will be more complicated than GUSD and JPMcoin, and will face more risks and challenges.
❹Libra should strengthen the research and unification of online payment rules, and promote a unified global payment and clearing regulatory system, which is inextricably linked with the traditional world.
The duel between Libra and Bitcoin is a duel between "centralization" and "decentralization", and it is the Internet VS blockchain. The final outcome is whether the Internet harvests the blockchain, or the blockchain harvests the Internet, which can only be verified by time.
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Fate from "Libra"
As long as the nation-state exists, Libra's fate will be rough.
We can try to explore the future possibilities of Libra:
❶ First of all, there are constant disputes between small countries and Facebook, because stablecoins first threaten those countries with unstable currency values. Residents of many small marginal countries in Africa prefer to hold Libra instead of the country’s legal currency. As long as the ecology is complete, holding Libra will It is very attractive for citizens of small countries to purchase materials and exchange foreign strong legal currency;
❷The strong legal currency of a big country will also suppress Libra, because Libra will continue to erode the legal currency of various countries if it exists for one more day. Which strong fiat currency would be willing to wait for such a result;
❸In the end, Libra strategically retreated and formed an alliance with the U.S. dollar, becoming an important member of the digital U.S. dollar and expanding its digital territory under the protection of U.S. national power. The digital dollar corresponding to the power dollar is nothing more than that.Once the alliance between Libra and the digital dollar is formed, it will verify that we areThe horror of the digital dollar mentioned in . It is completely different from the traditional U.S. dollar. Its essence is mathematics. Other countries can also manage traditional U.S. dollars through borders and prevent U.S. dollars from entering through financial control. However, the digital U.S. dollar makes national barriers impossible, and it can penetrate into any country more easily.
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Hayek wrote "The Denationalization of Money" in 1976.
In his book, he said that a free currency system should be allowed, allowing various currencies to compete with each other to survive the fittest, instead of naturally accepting the government's power to control the issuance of currency.
In 2009, the emergence of blockchain technology made possible the "denationalization of money".
In 2019, Facebook and Zuckerberg made this "money utopia" close to our real life.
There are too many injustices in the legal currency world dominated by "dollar hegemony". It is time to introduce more competitors. Libra's white paper reveals a strong sense of compassion: Looking at the world, the poor pay more for financial services. Their hard-earned income is used to pay for all kinds of miscellaneous expenses...
What exactly is Facebook's "ambition" or "ambition"?
Ready to reshape Facebook's business model in the further future?
Building a global "borderless currency" from a larger perspective?
To build a blockchain "digital empire" from a higher dimension?
A world of three powers that promotes political, religious, and economic checks and balances from a higher civilization?
Maybe we are all short-sighted and full of malice, but Libra means "Libra" in English, and Libra symbolizes balance and justice.
Regardless of the outcome of Libra, the courage and courage shown by Facebook and Zuckerberg have once again proved his personal pattern, and his success is by no means accidental. What about the rest of the tech giants?
The real currency war has just begun.
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