Facebook is preparing to announce its cryptocurrency formally. For some time now there has been talk of this development, and while we don’t actually know when the cryptocurrency will be rolled out yet, it sounds like we’re going to learn a lot more about it early this summer. As of now, we mostly know that it’s called libra, that it’s backed by various prominent companies and currencies, and that it’s expected to be integrated directly into the existing Facebook social network.
This is a fairly limited overview, and leaves room for a lot of questions. When will libra be available, and how will consumers acquire it? Will it be compatible with external crypto wallets, or exclusively reserved for Facebook? How much will it cost to acquire initially? The answers to these questions will help to define how the public reacts to libra’s launch, and how it performs in the short term. The most important question, however, will ultimately be the obvious one – where will this cryptocurrency actually be useful?
More than anything else, libra will likely be meant to facilitate transfers of wealth between Facebook users. The social network has already made it possible for its users to exchange money on the platform, the same way they might do via Apple’s iMessage or a payment app like Venmo, and libra can effectively function as another version of this practice. People will simply trade it back and forth as it suits them personally.
Gaming & Betting
Facebook is a much bigger gaming platform than it tends to get credit for, and the network will likely put libra to use as an acceptable payment method for some of its local games. What will be interesting is to see if libra can also be used through Facebook-driven accounts at external gaming sites. In particular, we’ve seen that some of the best betting sites and casino platforms hosted in places like New Zealand and England are already exploring cryptocurrency acceptance. Should such sites allow users to make accounts with Facebook, it could be that libra will become a valuable asset for this form of gaming and betting as well.
Just as Facebook has more gaming content than anyone ever seems to talk about, it also has a robust marketplace, through which users can buy anything from a box of doughnuts to a used car. The way it works, for those who don’t use it personally, is that items are simply listed along with various types of payment or links to external selling sites, such that there are different ways to pay for different goods. It’s unclear whether or not libra could instantly be used for all marketplace purchases – certainly not, unless Facebook is willing to convert it back to cash for sellers who don’t want cryptocurrency. But we can certainly expect at least some libra integration in this space. And as with external gaming sites, it will be interesting to see if down the line, independent retail sites that allow consumers to register with Facebook accounts may also start accepting libra.
Charity was actually mentioned here once before among the industries in which people can actually put their bitcoin to use. There happen to be numerous platforms that accept cryptocurrency as a means of charitable donation, and there’s no reason to suspect they wouldn’t welcome libra as well. And particularly given the amount of social activism that already takes place on Facebook (people can even organize fundraisers for specific purposes), it stands to reason that libra will be put to use for good causes in one way or another.