The much awaited Facebook’s led cryptocurrency has finally been released. The whitepaper has attracted a frenzy in the crypto space as crypto enthusiasts, experts and industry analysts delve into the details of the new kid on the block.
While the majority of crypto worshippers have hailed Libra as the crypto that will enhance mainstream adoption. However, Binance Research and Jameson Lopp have given their views on the new crypto.
Facing Similar Challenges like Ethereum
In a Medium article, Jameson Lopp claims that the Libra blockchain will not address the various problems experienced in Ethereum network.
Dissecting the whitepaper, Lopp claimed that Libra sound like an awful lot just like Proof of Stake since its stated that the network will move from permissioned to permissionless and open system. He said that the blockchain will also face similar problems like Ethereum. He explained:
“Apparently the plan is to open up membership after 5 years and hopefully they’ll have figured out Proof of Stake by then… I expect they’ll run into the same problems as Ethereum!”
Lopp continued his analysis by explaining that the Calibra Wallet, that will be the only wallet to store the Libra coins for now, will need stringent KYC/AML compliance. As the white paper claims, the blockchain aims at replacing the stablecoin in favor of resources.
In this regard, Lopp speculates that the Facebook startup will put more efforts on smart contracts as it is developed on a tailor made contract programming language known as “Move”.
Fiat in Crypto’s Disguise
Binance Research team claims the new crypto will be a fiat in crypto disguise. The team analyzed the white paper that was released on June 18 and came up with a report highlighting some of the important issues and giving their opinions.
The report says that the Libra crypto will be supported by Libra reserve which consists of various low-volatility assets that comprise of USD, GBP, EUR and JPY.
The report compares Libra to JPM coin and claims that Facebook is set to position itself as a bridge between the conventional financial institutions and the public. However, unlike JPM coin, Libra will be public and tradable on crypto exchanges.
The team believes that the coming days will be important for the Libra community as its success will depend on how the crypto worshippers will understand how it works and its difference from others in the industry.
Political and Regulatory Challenges
Apart from facing common challenges like Ethereum, Libra is also confronted with political and regulatory challenges. There were widespread speculations even prior to the release of the white paper.
Reuters reports that United States House Financial Services Committee Chairwoman Maxine Waters has released a statement that requires the project development halted waiting for a nod from Congress and other regulatory agencies after they review it.
What’s your take on the new Facebook’s cryptocurrency? Will it disrupt the crypto space and be vital in mass adoption of cryptos? Share your views with us in the comments section.