XanPool Blog

FacebookCoin “LIBRA” Adoption? Fuck Yeah!

Facebook’s desire to develop it’s own cryptocurrency has been shrouded in mystery ever since they secretly acquired the “Libra” trademark back in June of 2018. Internet speculators were proven right when at Facebook’s recent F8 event, Mark Zuckerberg made some announcements stating how commerce should interact with his his platform, and how Whatsapp, a product of Facebook, will soon allow individuals to send and received money.

Several executives at Facebook have also been claiming better checkout and payment processes on various Facebook marketplaces where it’s cryptocurrency will be used. It makes perfect sense for Facebook to streamline the user experience when it comes payment for their various services. But, what does this mean for existing cryptocurrencies? Are they now doomed to be crushed under the network effect of Facebook?

If you’re like me, you read the headline, chuckled, rolled your eyes, and got back to doing your thing. Though after rolling the idea around in my head a bit longer , I started to believe that FacebookCoin will hugely benefit the Cryptocurency space, and largely damage traditional banking and payment processors. Two pluses in my books!

Libra Is Not That Different From AliPay or WeChatPay.

Despite multiple publications shitting themselves in misguided excitement, proclaiming that new and innovative FacebookCoin will be the nail in the coffin for Bitcoin. The applications to FacebookCoin is actually not that different from AliPay, WeChatPay, Venmo or any other peer to peer payment platform that already exists. And despite the theses publications’ erroneous statements in the past of how XYZ will be a “Bitcoin Killer”, these peer to peer payment platforms have only helped the adoption of Bitcoin, and serve as a method of onboarding when traditional banks will not.

Take Mainland China as the prime example; In 2017 when regulators began clamping down upon various exchange platforms, all of the Chinese investors flooded to Over-The-Counter (“OTC” – a peer to peer method of exchange) services. And to date, most of the Chinese volume is conducted through peer to peer payment platforms such as WeChat and AliPay with a peer to peer marketplace facilitating the transaction. (Exactly what XanPool does).

Facebook employs bright people, so surely they know that FacebookCoin is not going to halt Bitcoin adoption but only help it. They must be angling at a larger market. Just like Jiro’s Dream of Sushi (film about an elderly 3-Michinline-star sushi chef who spends his life mastering the craft of creating sushi) this is a tale of individuals attempting to obtain mastery, not in any east Asian culinary arts, but in the mastery of your information – “Zuck’s Dream Of Data”.

MasterCard & Visa Be Wary, FacebookCoin Libra Is Coming To Town.

Facebook earns it money selling targeted advertisements, and details into consumer spending would be among the top most coveted data by Facebook. Unfortunately for Facebook, credit card companies and payment gateways have since the rise of e-commerce been the gatekeepers to this data. Not for long though, because to Facebook, private consumer data is like cocaine, and Facebook can’t help but prepare themselves to another line, as the they aim their crosshairs at MasterCard and Visa to take over their turf.

MasterCard and Visa need to be weary, because as more merchants adopt FacebookCoin as a medium of exchange, Mastercard and Visa will find it impossible to compete. Facebook’s gross profit is more than both of Visa and MasterCard’s combined. Facebook is thus able to starve out Visa and MasterCard by subsidizing their new FacebookCoin payment business, with their highly profitable advertisement business. And to drive merchants adoption, Facebook is definite willing to sacrifice short term return have consumers spend more time on their platform. Because every additional second, every additional purchase with FacebookCoin, gives Facebook more data. And that is the aim of the game for Facebook at the moment.

Conclusion: FacebookCoin Libra Will Drive Bitcoin Adoption.

In the end, you have to understand that what Facebook is proposing with Libra, is not a cryptocurrency. As Libra not have any of the fundamental properties of an open blockchain. Libra is not open, Libra is not public, Libra is not neutral, Libra is not borderless, and Libra is not censorship resistance. Because of these characteristics of open blockchain stem from a decentralization of control. Thus, anything that is created by a centralized organization, that is identifiable, and is subject to laws of specific jurisdiction will prevent the emergence of the characteristics.

With the adaption of FacebookCoin. Not only will the commercial data collected be at risk of being release to governing bodies, advertisers, or firms like Cambridge Analytica. Facebook will also hold more power over it’s users than ever due to them now controlling their users’ money.

Facebooks has historically repeatedly shown that they are not a neutral platform, willing to arbitrarily exclude individuals from their services and essentially “deplatforming” them. When FacebookCoin becomes a major form of payment(and there is a large chance it will), in time, individuals will be forced to abide by Facebook’s arbitrary guidelines simply to engage in commerce. And if an individual’s behavior does not satisfy Facebook, he will be excluded form using FacebookCoin.

As the risks of seeding too much personal information, and relying solely on FacebookCoin for commerce becomes more well understood. Individuals will eventually begin to look into censorship resistant forms of money (permissionless money that anyone can freely use, and is not controlled by a small group of entities). And only Bitcoin and a very small number of cryptocurrencies fit the definition of censorship resistant money.

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