The launch of the cryptocurrency Libra announced by Facebook earlier this week has prompted many discussions about the future of finance, particularly the role of cryptocurrencies. The project has grabbed the attention of regulators all over the world, most of them calling for the project to be delayed or even scrapped.
In the crypto space, some experts have expressed their disapproval over a big tech company entering the area, while also acknowledging that the launch of Libra could be a tipping point in the history of blockchain.
On the latest FinancialFox, crypto PR guru Stefania Barbaglio interviewed On Yavin, CEO and founder of Cointelligence about his views on Libra. He is an angel investor and serial entrepreneur with more than 20 years of experience in the tech industry. A leading authority on cryptocurrency, he is also a data-driven strategist.
His company, Cointelligence, conducts data research and analysis for the crypto economy. Cointelligence was created to bridge the information gap in the crypto economy, and also offers professional due diligence and blockchain advisory services.
“The new Facebook coin is a fake cryptocurrency. They are calling it cryptocurrency because it is a buzzword. It may be a digital currency, but it is not a cryptocurrency. It is a crap coin,” says On Yavin.
On believes that Libra is not a real cryptocurrency because of three main factors:
- A Facebook digital currency will by definition be largely centralised.
- Facebook has a huge trust problem after its poor track record in securing its users’ personal data.
- Facebook is partnering with big companies such as Uber, Paypal, Vodafone and Visa to create Libra. In essence, this means that big corporations will continue to control the system and exploit users. “That is the opposite of what a cryptocurrency should be,” says On.
Libra might eventually have a financial value, he says, but the whole system sounds illegitimate and it does not represent a real cryptocurrency.
Libra could make crypto mainstream
Whilst Libra itself might sound like a poorly developed cryptocurrency, its impact on the cryptocurrency market is likely to be positive and could be the move needed to bring cryptocurrencies into the mainstream.
Regardless of the future of Libra, its launch has exposed huge numbers of people to cryptocurrencies and the world of blockchain. Because Facebook has now officially stepped in, crypto may start to be viewed as more serious and credible.
Up to this point, conversations about cryptocurrencies have been nearly exclusive to technologists. Now with the launch of Libra, Facebook is practically making cryptocurrency available to its two and a half billion users at once.
“I think that the positive side is that Libra will get so many people introduced to the new generation of digital payments and some of them will want to learn more about real cryptos like Bitcoin and Ethereum,” says On.
With the threat of disruption posed by a company the size and influence of Facebook launching a digital currency, regulators and central banks have started to look seriously at the crypto world, which could prompt much needed regulations of the market.
The launch of Libra means that the cryptocurrency market is bound to become more interesting for outside investors. Nevertheless, it is important for those entering the crypto space to be careful and carry out thorough research before putting down large amounts of money. We are still at the ‘young’ stage of the crypto market, so there are plenty of scams going around, which can easily lure eager investors into fraudulent projects.
On’s company Cointelligence helps to identify the most authentic projects and exchanges in crypto. Cointelligence found over 80–85% of crypto exchanges to be faking trading volume to get their rankings up on listing websites to increase revenue. “There’s very little transparency on crypto exchanges. This is misleading to investors,” says On. He warns users of different types of malicious actors around:
- Scammers: people who launch fake projects with the intention of stealing investors’ money
- ‘Mini scammers’: people who found crypto ventures quite genuinely, although the project is not feasible in reality and does not bring returns
- ‘Scamming neighbours’: the partners of a fake project, such as the publishers that advertise it and YouTubers and influencers who promote it
More developments are sure to unfold soon and whatever happens, the crypto market could be on its way to a great transformation. All eyes on Libra.
Watch the full interview here: