More On Libra


Some notes on Libra, as a topic of digital currency:

  • Libra might not be blockchain-based. Instead, it could be leaning towards hashgraphs as hinted by the Hedera community. Hashgraphs (capable of processing thousands of transactions per second) and blockchains (5 tps for BTC, 15 for ETH) are distant cousins under the DLT tree.
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  • How to not get bogged down by many regulators across many jurisdictions? Possibly compliance is outsourced to resellers and exchanges, just as a central bank while issuing currency does not deal with individuals or businesses but have banks do that.
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  • Wouldn't banking and exchange fees apply when Libra is converted to fiat eventually? That is if it is converted to fiat. But what if there is no need to because the ecosystem is a big enough to be 'self sovereign'. Imagine, having your burger, roti, nasilemak, fried noodle or sandwich priced and be purchasable in Libra. [Just a thought experiment, it is not OK in most countries to transact in non-local currencies for local transactions.]
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  • How can the unbanked get banked when they don't have a bank account (like you need one to use PayPal)? Perhaps, Libra will operate on a threshold basis, say, if you have max USD 500 in balance and total transactions per month, you are subject to little or no KYC.
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  • What is to stop people from mass converting local currencies to what they perceive as a more stable Libra? Likely through limits, you can use Libra for transactions but not move your entire savings there (also Libra won't be paying interest). But, it is not impossible to imagine a country going fully international and digital by adopting Libra (or similar) as its currency just as countries like Ecuador uses the USD as its currency. The advantage is (possibly) a stable currency, the disadvantage is the country's currency is at the mercy of Zuck (or the Libra association, or Trump, or Geneva).
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  • What about privacy? You can assume there is none thus if you want to buy weed (or hold a company ransom by locking up its files), you will need to use...BTC. Or you can assume if privacy is so important, if Libra doesn't provide it, a competitor will come along to provide it.