- Libra’s mission is the enhancement of a global currency to empower billions of people especially those who do not own bank accounts or credit cards.
- Facebook has formed an organization named Libra association to imbibe trust in its users consisting of 28 members from across various sectors.
- Libra can be encashed with dollars or one’s native currency, the money paid in native currency goes into the Libra reserve.
- The Libra blockchain is designed to perform 1,000 transactions per second signifying that it is built for speed.
Facebook announced its plans about its digital currency-Libra last year. Libra’s mission is the enhancement of a global currency to empower billions of people. Empowering especially those who lack access to banking services, who do not own bank accounts or credit cards. In other words, Libra will let people buy things at stores or use it to transfer money to others. Facebook’s whitepaper details out that it wants to enhance a cryptocurrency with less volatility, smart contract platform, and a new decentralized blockchain. Facebook CEO Mark Zuckerberg with few experts in Silicon Valley is imminent with the plan.
Who governs Libra?
Facebook has formed an organization named Libra association to imbibe trust in its users. It consists of 28 members from across various sectors including blockchain, payments, venture capital, etc.,
Libra Association members have invested at least $10 million each to connect to the system and to turn as a validator node. Besides, each member of the association has gained a single vote for the entitlement of sharing the dividends. This is earned through Libra reserve’s interest where fiat currency is paid by users to earn Libra.
The social media giant-Facebook aims to reach 100 founding members before the official launch of the Libra Coin. The whitepaper particularly clarifies that each member of the Association will have to oblige to the same financial regulations as any other member. Also, all of the members will own the governance power equally.
How does the Libra Cryptocurrency Work?
Libra can be encashed with dollars or one’s native currency, the money paid in native currency goes into the Libra reserve. Libra coins are earned based on the specific amount paid and get transferred to the user. In case money is cashed out from the Libra Association, the particular amount of coins is destroyed and the equivalent local currency is earned back.
Therefore, it signifies that there exists a 100% value of the Libra in circulation. Additionally, it is assured with real-world assets in the Libra Reserve. It never runs fractionally. The value of a Libra is created to have stability, to ensure a safe medium for exchange. The Libra’s value is tied to a container of bank deposits and short-term government securities and is maintained by the Libra Association. To ensure that Libra’s value is consistent, the Libra Association can change the composition’s balance to counteract price fluctuations in any of the foreign currencies.
The Libra Blockchain
The blockchain operations and verification are performed by Libra Association’s founding members. This blockchain is designed to perform 1,000 transactions per second signifying that it is built for speed. It will ensure the following key requirements:
- Security of financial data and funds.
- Scale billions of accounts requiring low latency, high storage capacity, and efficient transaction throughput.
- Power the Libra’s governance and innovation in financial services in the near future.
The Libra blockchain’s design meets the above requirements and will employ innovative approaches from already existing projects.
The noteworthy features of the Libra Blockchain:
- The Libra implements the Byzantine-Fault-Tolerant Consensus approach. This is for the facilitation of consensus amongst all the executing validator nodes on the transactions. Alongside, the order of execution.
- It can perform iteration on data structures and employs Move Programming Language. The move is a programming language for implementing custom transaction logic and smart contracts on the Libra Blockchain. Also, the language has been built keeping security and safety their utmost priority.