Currency happens to be the lifeblood of the global economic system. It is the pivot around which wheels of economic activities spin; however, with the emergence of the capitalist economy, the money power tends to be possessed only by a few ones. The inequality in the distribution of wealth is one of the primary concerns of economists and along with its social-economic implications, researchers are worried about the long-term impact of rising economic inequality among social classes.
Digital Coins: A Credible Alternative
Cryptocurrency has presented itself as a credible alternative to the fiat currencies, and thanks to their digital nature, these currencies are finding favor with new-age generation. Bitcoin, ethereum, and Litecoin are some of the popular cryptocurrencies available in the market, and now joining the list is the Libra cryptocurrency from the house of the biggest social-networking site, the Facebook. Libra aims to provide a global financial infrastructure that will help to transform the lives of billions around the globe. This objective is quite ambitious, but given deep financial pockets its backer has, there shouldn’t be any difficulty in realizing this aim at least from resource viewpoint.
Libra is claiming that everyone around the globe can have the cryptocurrency and all you require is to have a basic Smartphone and internet connection. There is no complexity involved in terms of accessing the currency and thanks to the separate reserve that its inventors have specifically set aside for the currency, the value of the Libra is expected to remain stable over a period of time. Unlike other cryptocurrencies available in the market, this stability factor will prove advantageous for the Libra. The transactions made through Libra are fast, secure, and thanks to the underlying technology of blockchain on which it is based, the cryptocurrency can be used for making transactions around the globe without any concerns of security and time lag. In order to widen the prospects of its adoption, Facebook will provide an extensive platform for developers’ to build an impressive ecosystem of the product and services. The working mechanism of the Libra is just similar to that of Bitcoin, with the only difference being that the former will be stable in its valuation while the latter keeps on fluctuating.
Libra has been able to attract the number of partners from across the industries, including the likes of Shopify, which is a major online commerce company dealing in a variety of products and services. This partnership is going to bode well for both the companies as scores of customers can do the shopping on the Shopify with the help of Libra. The project of Libra cryptocurrency has got its own share of issues, with the most important one being the regulatory aversion to the coin. Many Federal governments and Central banks have expressed their inhibitions towards Libra, and given the dominant cloud Facebook has in the segment of Social-networking sites, policymakers are apprehensive whether Libra will have the same kind of dominance in the fiat space. In order to get around these concerns, Facebook is now planning to enroll other Fiat currencies also on its network along with the Libra token. As the next step, Facebook is looking to launch Libra cryptocurrency on a global scale. This will help to increase the adoption of Libra and brings the much-desired aspect of scalability to the table. Overcoming regulatory issues and taking governments into confidence is also a herculean task that Libra project has to accomplish before it can realize its dream of becoming a household name in the segment of digital currency.
There is hardly any doubt about the convenience of cryptocurrency and Libra project backed by the social-networking behemoth Facebook is good news for the crypto industry. As Libra is backed by a dedicated reserve, its value will remain stable and that is a plus point when it comes to its wider adoption across the globe. The only Elephant in the room remains in terms of regulatory concerns that Facebook has to address and that’s quite a tricky affair.