Facebook’s Libra Concept Ripped from MIT Students’ 2018 Research Paper Per New Report
Facebook has recently been accused of stealing the concept behind the social media platform’s Libra, from a paper that was published on Royal Society’s Open Science 2018 publication reports Coin Desk.
The research article dubbed, “Digital trade coin: towards a more stable digital currency (Tradecoin),” was written by Alex Lipton, Thomas Hardjono and Sandy Pentland.
The news outlet did a brief comparison of Libra’s white paper and the research article. An example of similarity was shared. In particular, the white paper noted that the digital coin would remain constant in value because it would be backed by an array of currencies. The authors previously voiced the idea of an:
“asset-backed, supranational digital token.”
Other similarities found between both projects include the involvement of several parties, its role in domestic and cross-border payments and ensuring that financial services are provided to countries lacking a strong financial system.
Lipton shared with Coin Desk that the researchers were in fact ripped of their concept. More specifically, the co-author was quoted saying:
“Without being particularly obnoxious, I can tell you that the actual structure of Libra is pretty much lifted verbatim from the paper which Sandy Pentland and Thomas Hardjono and I published last year.”
He further expressed distaste for not having been mentioned in Libra’s whitepaper, adding that this endeavor was published as a “free-for-all”. According to Lipton, Facebook cannot argue that they’ve never come across the paper, and if they truly haven’t then,
“They shouldn’t be probably doing what they are doing in the first place.”
Lipton’s Take on Libra Flaws?
Lipton shared that their idea for Tradecoin was,
“a way that small countries, sovereign wealth funds, and retirement funds could get a fair shake in the world’s financial system, instead of being ignored or exploited by the big central banks.”
He further added that the conceptualized crypto would have been backed by assets such as oil or commercial crops, adding that they would not have considered the likes of Uber. One problem that the author sees in the Libra design, is that the token would be issued in a “non-immunized fashion.”
This approach will require Libra to purchase government securities and others to back the coin, that way money can be circulated. This, however, could have a negative influence on their goals of helping developed countries. Moreover, he said:
“In developing countries, it will cause enormous inflation because the amount of money will be kind of doubled, roughly speaking […] I am not a big fan of quantity theory of money, but I am absolutely certain that as the amount of money explodes, prices will go up.”
Since the accusations, Facebook has yet to release a statement.