What does Libra mean for the future of cryptocurrency?

hey everyone welcome back to Tech Talk
I’m Julia Beauchamp I’m here with Lucas Mearian senior writer at Computerworld
earlier this week I asked will cryptocurrency ever become mainstream we
might have a little bit better of an idea about that now after mark
zuckerberg testified in front of Congress so stick around Thank You Lucas
for joining us so will cryptocurrency ever become mainstream it’s the question
of the hour and I have the answer yes cryptocurrency will become mainstream in
18 months I think eventually it will and cryptocurrency will eventually become
mainstream it’s too good it’s too easy not to but there are so many things they
have to answer about this technology first how secure it is and whether it
can scale those are two of the big ones so what exactly so my next question is
is it gonna happen in 2020 when libras supposed to roll out there’s been so
much regulatory pushback yesterday when or yes yesterday when chase Thursday
yesterday when Mark Zuckerberg testified in front of Congress he said that he
wouldn’t roll out Libra or the Libra association wouldn’t roll out Libra
until US regulators approve it so when do you even foresee that happening boy
there’s a lot of chess pieces moving they’re not the least of which is what a
lot of people could refer to as the banking Lobby banks have reason to be
threatened by cryptocurrency in general because it removes the middleman it
removes the clearance and settlement process that’s currently performed by
central banks and depository and clearance corporations
so this basically creates an open market a free open market to exchange currency
around the world and nobody has to clear because it’s automatic so I think the
banks could be behind some of this some of the lobbying going on in Congress
right now at least one analyst is absolutely positive of that just can’t
believe otherwise named some of the banks
in fact one of them had created its own cryptocurrency JPMorgan Chase no she
doesn’t evidence of that but there was some
statements made that led her to believe that and they have created their own
cryptocurrency but it’s for institutional customers is not for the
consumer exactly that’s where I want to sort of really this is that there’s a
lot of sort of cryptocurrencies floating around or in development that are like
Libre a fiat currency but Libre is a a fiat currency that was kept back back
yes yeah well yeah what’s like the technical
Fiat backed cryptocurrency right so a Bitcoin does it doesn’t have well some
people would argue against this but I don’t believe it has an intrinsic value
it’s all based on supply and demand there’s nothing behind it there’s no
government backed currency behind it or cash behind it
fiat backed currency on the other hand you have to have money deposited
somewhere where it can be accessed to back up that cryptocurrency that you’re
using so one-to-one in most cases one dollar equals one digital coin for
example gotcha so there’s the difference between Libre and something like JPM
coin is that Libre is for the masses it’s for consumers anyone should be able
to use that trading yep yeah and I would I understand that that’s sort of where
the concern comes in because if you’re opening up Libre and the digital wallet
Calibra to Facebook’s massive massive user base of literally billions of
people it could basically become a de facto currency and some disrupt
financial systems around the world now what Mark Zuckerberg said is that if
we don’t revamp our financial our outdated and stagnant financial system
we’re going to be left behind by countries who are already looking into
national crypto currencies like China like India and we don’t want to be in
that position at least one analyst I spoke to said that that is upon
of those empty threats and that china is not going to be coming up with a
cryptocurrency of its own that’s going to replace the dollar as the de facto
standard for business around the world but that’s that’s the the threat that’s
being made or at least the warning that’s being made by folks like Mark
Zuckerberg who by the way who’s most the time before the house finance committee
as one big Mia culpa for all the things they did wrong with Facebook such as the
privacy concerns in Cambridge analytical and 2016 Russia and election
interference so it was interesting that he spent so much time apologizing for
the mistakes of the past and I think a lot of that is because whoever the
presidential candidate or whoever becomes president next if it’s a
Democrat is likely to at least explore the possibility of breaking up Facebook
yes some other large monopolies and exactly why and I remember you mentioned
this in your story which will also link in the description is that Facebook Mark
Zuckerberg was kind of saying like anyone but I don’t know anyone but
Facebook or the public wants anyone but Facebook to be doing this and I mean
it’s great that in theory it seems like a good idea but because of Facebook’s
ongoing privacy concerns the Cambridge analytic escape data breach I mean just
in the past year there’s been I cannot count how many data breach it’s not like
tons and tons but enough that I can’t think of them off the top of my head
that have happened so it I not only is there probably a distrust between
Facebook and regulators around the world al Qaeda just yet financial regulators
across the world because every country might regulate a crypto currency
different ly but I also think I wonder if consumers could be concerned about
their privacy because this is something that is of Facebook’s creation even
though it’s not necessarily governed or regulated by Facebook right so part of
the pitch for having a cryptocurrency see on Facebook is that it be secure and
one of the first questions of legislators was exactly how and more
importantly how do we know that you’re going to be able to comply with know
your customer rules or anti money laundering regulations that keep
nefarious characters from going on and using an anonymous profile in order to
transact behind the scenes because you don’t know who owns those
cryptocurrencies now Mark Zuckerberg says no you have to have a Facebook
account in order to own these cryptocurrencies we’re gonna make sure
you know these people but how difficult would it really be to create a false
Facebook account if we write without bells banking information or banking
information that can’t be readily traced and then use that to purchase these
digital coins that are on a blockchain a distributed peer-to-peer network that
isn’t traceable because you have cryptography protecting the privacy of
the users so these are the questions that Congress had from Mark Zuckerberg
one of the problems with Libra is not a lot even in the white paper that was put
out there’s not a lot of detail about it and that’s what’s hampering it right now
so I think the combination of what is this exactly and how are you going to
deploy exactly I think Mark Zuckerberg and his engineers probably know or have
a very good idea of how they’re gonna deploy this but they haven’t said much
about it at this point so I think that’s what Congress is
looking for that maybe some pressure from the banking lobby against this
because of the threat cryptocurrency represents certainly Europe and
countries but Europe and especially France in Germany have made it clear
they will not allow Libra within their borders I mean some of the regulators I
shouldn’t say all but some regulators said no because and I want to use the
right terminology they said it would threaten their euros value and
unlawfully unlawfully privatize money those were the two main concerns so
you’ve got two major Europe European Union members saying we will
not allow Libra it hasn’t even launched yet it’s just been thrown out as an idea
and they’re already pushing back China has banned Bitcoin right right right so
I’ll have other countries some middle Mideast India have also pushed efforts
to block Bitcoin so there’s a lot of hurdles that Facebook and Libre Libre
and the labor association are going to have to face to roll out as far as
regulatory approval goes but even within the own Libre Association there is a bit
of trouble right and okay so here’s this is where the whole banking Lobby
argument came in and again this is sort of insider track stuff where they’re
saying companies like MasterCard and Visa and eBay have left
the Liebherr Association the governing body for this cryptocurrency so Facebook
would not actually govern the cryptocurrency once it’s out this would
be done by this nonprofit organization that’s represented by right now 21 used
to be 27 28 29 companies but had we had seven I think left yeah big names I have
this pulled up on my screen if we want to look at it who has left
and what’s major this is in another one of Lucas’s articles which I will also
link below and what’s interesting is that the majority of the companies who
have less you have MasterCard who left you have PayPal stripe visa financial
services companies and anyone who is unbeliever Association was expected to a
take Libra and MasterCard and Visa correct me if I’m wrong we’re also
expected to sort of convert that’s right they were going to convert the digital
coin to US dollars in the United States and euros elsewhere whatever sure yeah
we type of currency it might be but that was that was what they were expected to
do so those are big names being pressured allegedly by
the biggest card issuers so the biggest banking corporations out there that
actually issued the cars they’ve got the purse strings exactly and I was actually
listening to a story about this earlier today and the point that I believe it
was on NPR so the the point that NPR made was that Visa and MasterCard
already know how to roll out financial services systems across the world yeah
Facebook I mean maybe they know what they’re supposed to do but they don’t
have that practice so with two of these huge huge financial service companies
backing out of the Liebherr Association it doesn’t mean that Libre will never
happen but it’s now gonna just have to overcome many more hurdles it’s been put
on I would say a kind of pause I think the Libre association’s members the
Libre Association made it clear they still want to move forward Mark
Zuckerberg is being his couching the rollout of this in his in his apologies
for what Facebook has done he’s saying we’re not gonna do anything until you
guys like this right but he was pitching this to begin with as a system for the
unbanked so people in third-world countries and it’s cryptocurrency
absolutely makes a lot of sense for them because they even have a very poor
banking system or they have a monetary system that’s failing like Venezuela
people don’t want to put their money in banks because I think a grain of corn is
worth more than the money down here right now so they this gives them an
opportunity to put their money somewhere where it can’t be affected by their
local economy that makes sense yeah and also now for trade purposes now think of
a coffee grower in Colombia who instead of putting a sack of coffee on a mule
and taking it down the road to this is the one distributor who can pay him for
that and might be paying him a tenth of what it’s actually worth because he
doesn’t have a vehicle and they’re you know thousands of coffee growers like
this instead now he can go on to an open market and get the market price for that
car he still has to put it on a mule to get
it to where it’s gonna be shipped but he can get the money for it via a financial
system backed by blockchain and cryptocurrency yeah it’s like I said at
the beginning this video it’s something that is good and helpful in theory it’s
just going to be interesting to see how it rolls out when eventually as you have
promised we won’t quote you on that it rolls up
for the mainstream I I think you’re gonna see cryptocurrency you’re gonna
see blockchain in general morph as it matures and what you’re gonna see is
you’re gonna see hybrid versions of it you’re gonna see what’s called a private
or permissioned blockchain that is only between the companies behind the scenes
doing the processing work or in case of a supply chain communicating behind the
scenes to track their their goods and then you can see a public-facing one
that’s gonna be on an open public blockchain that will allow you to scan a
QR code and look at the history of that product that you just purchased who was
the farmer who grew it you know who shipped it where was it how you know how
safe was it so along its journey those sort of things including the ingredients
that were added to it if it’s a multi ingredient product for that matter so
you’re going to see these hybrid block chains really take over moreso than what
we’re seeing today which is simply either permissioned or open public block
chains in the case of Bitcoin sure well thank you so much Lucas – any other
thoughts about libre cryptocurrency Fiat backed cryptocurrency I need to
make sure I get that right yeah only then we want to think of this in long
term right now we’re still deeply into the hype phase we’re starting to start
and come out of it in some industries but for the most part we’re deeply into
the hype phase right now like open software Linux like the internet itself
this is gonna take a lot of time to develop we could be looking five 10 15
years down the line I’m just throwing it out there it could be that long before
we see cryptocurrency mature to the point where it becomes mainstream
great well thank you so much Lucas I learned a lot had a lot of fun I’m
intrigued to see where this goes absolutely and thank you all so much for
watching this episode of tech talk if you liked this video be sure to give it
a thumbs up and subscribe to our channel again be sure to check out the links in
the description below I’ll link to two of Lucas’s stories which are massively
informative if you want to learn any more about cryptocurrency Libre etc
thanks again and we’ll see you next time

1 thought on “What does Libra mean for the future of cryptocurrency?

  1. These people don't know crypto. Of course Bitcoin don't have a backup it's decentralized. This is why Bitcoin is King and Crypto is already mainstream. Also who cares of Libra. Mark don't know crypto. Stick to your boring Facebook.

    It will never beat Bitcoin.

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