Facebook promises faster cross-border transfers with Libra

| |

Daniel Webber
Daniel Webber
Founder & CEO
Daniel is Founder and CEO of FXcompared and has 18 years of experience in the international finance world focusing on cross-border payments, technology and the property sectors. Daniel is widely… Read more
  • Libra set to be launched on blockchain to improve access to money transfers
  • Clear demarcation between Libra transactions and Facebook data is planned
  • “Moving money around the world should be as easy and cheap as sending a text message”, claims Facebook

 

Social media giant Facebook has confirmed that it plans to expand into the online money transfer space by launching its own blockchain-backed currency called “Libra”.

Speculation has been swirling for weeks that the corporate tech giant was about to makes its first foray into remittance services, but the announcement Tuesday has confirmed that.

According to the new website for Libra, its aims are to: “Reinvent money. Transform the global economy. So people everywhere can live better lives.”

The site says that 1.7 billion people around the world do not have access to banks, and that many cross-border payments can take up to five days to settle.

It also claims that “unbanked” people pay $4 more per month as a result of their status – and that the new cryptocurrency will change that.

“Moving money around the world should be as easy and cheap as sending a text message. No matter where you live, what you do, or how much you earn”, Facebook said.

“Libra is a global, digitally native, reserve-backed cryptocurrency built on the foundation of blockchain technology. People will be able to send, receive, spend, and secure their money, enabling a more inclusive global financial system.”

While Facebook is behind the development of the new Libra currency and will offer access to it through Facebook and Facebook-owned services such as WhatsApp and Messenger, other organisations will be involved too.

Andreessen Horowitz, a venture capital firm, will have a seat at Libra’s decision-making table, as will Visa.

Both firms have made an investment of several million dollars into Libra.

They will form part of the Libra Association, which will be responsible for encouraging users to move to the open source “Libra Blockchain”.

This blockchain will come with its own programming language.

One concern raised by many in the tech community as Facebook announced this new form of money transfer was the impact it could have on privacy.

However, Facebook is believed to be planning to open up a new company, known as “Calibra”, which will ensure that the data a Facebook user shares will not then be redirected for the purposes of advert targeting.

According to a Facebook spokesperson, the aim is not for Facebook to accumulate quick profits from Libra.

Instead, according to Facebook’s VP of blockchain David Marcus, the goal is to simply encourage more transactions to happen on the internet – and then move in later with advert propositions.

“If more commerce happens, then more small businesses will sell more on and off platform, and they’ll want to buy more ads on the platform so it will be good for our ads business”, he explained.

Discover more about what firms in the online transfer space are doing here.


Most Read

Use Our Currency Comparison Tool

Select country...

Select country...

Send

Editor's Choice

FXcompared.com is an fx money comparison site for international money transfer and to compare rates from currency brokers for sending money abroad. The website and the information provided is for informational purposes only and does not constitute an offer, solicitation or advice on any financial service or transaction. None of the information presented is intended to form the basis for any investment decision, and no specific recommendations are intended.  FXC Group Ltd and FX Compared Ltd does not provide any guarantees of any data from third parties listed on this website. FX compared Ltd expressly disclaims any and all responsibility for any direct or consequential loss or damage of any kind whatsoever arising directly or indirectly from (i) any error, omission or inaccuracy in any such information or (ii) any action resulting therefrom.