What is Facebook’s New Cryptocurrency, Libra? – ConsenSys Academy
On July 17th, 2019, the ConsenSys Academy team presented a webinar about Facebook’s new (and currently theoretical) cryptocurrency, Libra. We covered some of its newsworthy elements, high level structure, technical fundamentals and Libra/Calibra business models.
For those of you who missed the webinar, you can catch the recording for free here or continue reading this blog post for our run-through of the Libra Association or “Council”, the Libra Reserve, the Libra Network, Calibra, and Libra Core (what a mouthful!).
To start, Graphic 1 is a map of the Libra ecosystem as we currently understand it based on our reading of the documentation. In this article, we’ll break this graphic into three parts and examine them. If you’d like to dig in in more detail, please do check out the webinar recording and the downloadable information package that comes with it.
This is Libra’s governing body and has three core functions:
- Governance: The Council manages the entire Libra system and is made up of a managing director, an advisory board, and the founding members, which so far includes Facebook and 27 other organizations including heavyweights Visa, Mastercard, and Paypal. Note that as reported by Nathanial Popper in the New York Times, agreements are thus far non-binding and no money has changed hands at the moment. This has been confirmed by Alfred Kelly, CEO of Visa, a Libra Association partner.
- Management of the Libra Reserve: This is the monetary reserve that backs Libra coin. Reserve resources come from the $10 million joining fee paid by Founding Members (like Visa, MasterCard, or PayPal), capital from third party investors, and from fiat currency ($$s) that consumers will eventually convert to Libra coin.
- Management of Libra Core: Libra Core is the software implementation of the Libra Protocol. This is the software that the validator nodes run that together form the Libra blockchain network. For their $10m contribution to the system, the founding members have the opportunity to run a validator node on the network. The Libra Association or “Council” acts as a steward for the Libra Core software, doing such things as screening updates to making sure they don’t violate the Founding Members’ Terms of Service. Within the Council, there is an advisory board made up of “Social Impact Partners” or SIPs. These are organizations (eg. educational institutions, not-for-profits, etc) that meet a certain threshold for social impact.
This is the permissioned consortium blockchain network that Facebook has proposed. For security and regulatory reasons, all traffic in the network is directed through a group of validator nodes, which will be initially comprised of the Founding Members.
- These founding members will all be running the Libra Core and will be using the $10m membership fee as a “stake” in the network to maintain its safety and security. We think it’s safe to assume running a validator node will require a lot of security and safety measures with no uptime guarantees (you can see the technical requirements for joining as a validator node here).
This is Facebook’s digital wallet platform which will be the “on- and off- ramp” for consumers to submit transactions to the Libra Network. Although few technical details about this wallet have been relevaled by either Calibra or Facebook, this will be embedded into a lot of Facebook’s digital products and therefore available to most Facebook users.
Generally, we can break down the Libra network into a couple of segments, but we like to think of it in the following way:
- The Association or “Council”, is a business organization, having to deal with international regulation and the reserve.
- The Libra Network, is a technical blockchain that borrows a lot from Ethereum and other blockchain products/projects.
- Calibra, is a consumer facing, wallet product.
It’s important to note when people talk about Libra, the system in its entirety includes these different bodies each with different concerns — and we’re just scratching the surface here. In the webinar recording, we go into much greater detail on each area, discussing their characteristics and important questions to ask about them. In the second half of the webinar, we dive into the technical aspects of the network, discussing the Facebook Move language (and how it is related to Rust), the structure of the validator network and distinguishing features of modules, which are the Libra equivalent of Ethereum smart contracts.
We read all the whitepapers so you don’t have to. For more information, check out our free Libra webinar and get our comprehensive analysis of Facebook’s new cryptocurrency.
Published at Tue, 06 Aug 2019 15:41:24 +0000
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By QuoteInspector.com on 2018-09-26 10:04:22
