Facebook, the world’s largest social network, has released the white paper for its upcoming cryptocurrency Libra, confirming rumours that the company is looking to move into the crypto sector.
Published earlier today, the document details Facebook’s plan for the stablecoin, which is pegged to a basket of assets.
“The mission for Libra is a simple global currency and financial infrastructure that empowers billions of people,” Libra Association, the independent consortium that will govern the project wrote.
Three pillars
According to the white paper, the Libra project consist of three parts: a “secure, scalable, and reliable” blockchain; a reserve of assets designed to give the coin intrinsic value and Libra Association, which will govern the project and handle the evolution of its ecosystem. The consortium is based in Geneva, Switzerland and consists of more than 20 companies from various fields, including payments, telecommunications, blockchain and venture capital. Initial members include Mastercard, Visa, PayPal, Vodafone Group, Uber Technologies and a new Facebook subsidiary called Calibra. The consortium aims to have roughly 100 members by the target launch in the first half of 2020.
The stablecoin will run on the “Libra Blockchain”, an open source blockchain designed to prioritise “scalability, efficiency in storage and throughput, and future adaptability”. The coin will be backed by a basket of bank deposits and short-term government securities. This means that the token will not always be worth the same amount in a given fiat currency, as its value may fluctuate depending on how the value of the underlying assets changes. Still, the reserve assets have been chosen to minimise volatility, “so holders of Libra can trust the currency’s ability to preserve value over time”.
“The assets in the Libra Reserve will be held by a geographically distributed network of custodians with investment-grade credit rating to provide both security and decentralization of the assets,” the white paper reads.
Featured image: sitthiphong / Shutterstock.com
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