How's Facebook's Libra going to help businesses? Source: BERTRAND GUAY / AFP

How’s Facebook’s Libra going to help businesses? Source: BERTRAND GUAY / AFP

Not-exactly-Facebook-owned Libra is a great fintech bet

SINCE its recent launch, everyone in the technology space has heard about Libra — the new global fintech infrastructure ecosystem that can reach billions of people almost immediately.

Currently associated predominantly with “Facebook”, the Libra Association is a non-profit headquartered in Switzerland with a long list of members (nearly 30 right now, expected to be 100 by the time Libra is ready for launch next year).

While Facebook, through its subsidiary Calibra, is the lead technology provider, other partners include Mastercard, Visa, Stripe, PayPal, Booking Holdings, eBay, Vodafone, Kiva, and Mercy Corps.

Together, the Libra Association aims to create a new kind of digital currency built on the foundation of blockchain technology.

The mission for Libra is a simple global currency and financial infrastructure that empowers billions of people.

According to the organizations’ whitepaper, Libra is made up of three parts that will work together to create “a more inclusive” financial system:

  1. It is built on a secure, scalable, and reliable blockchain
  2. It is backed by a reserve of assets designed to give it intrinsic value
  3. It is governed by the independent Libra Association tasked with evolving the ecosystem.

What’s cool about Libra — technology and business

Libra is a cool project. It’s got a lot of exciting technology running behind the scenes.

Libra will run on a new programming language called Move, use a Byzantine Fault Tolerant (BFT) consensus approach (this one’s a huge deal), and will be adopting and iterating on widely adopted blockchain data structures.

Of these, the developer community in the blockchain space is most excited about Move.

Building Move might have been a mammoth task but given that it takes insights from security incidents that have happened with smart contracts to date, it helps bring in a sense of security for stakeholders.

According to the documentation, Move makes it inherently easier to write code that fulfills the author’s intent, thereby reducing the risk of unintended bugs or security incidents.

Specifically speaking, Move is designed to prevent assets from being cloned because it enables “resource types” that constrain digital assets to the same properties as physical assets: a resource has a single owner, it can only be spent once, and the creation of new resources is restricted.

From the business perspective, however, Libra is exciting because of the possibilities that it will help create — for all kinds of businesses.

It’s not just the seamless flow of money that’s exciting, but the seamless flow of money across geographies that’s going to make all the difference.

Although a majority of the project’s partners are US-based, there’s an expectation that the majority of the impact will be felt in countries such as Nigeria, Sri Lanka, and India where access to financial services are limited, especially outside metro cities.

With help from Libra, every company could participate in an ecosystem that makes new financial services and finance-based solutions more accessible and exciting.

Maybe it’ll all start with parents paying school fees for their children over WhatsApp. The possibilities are absolutely limitless.