Facebook in collaboration with 27 other companies will launch its cryptocurrency called Libra by 2020. The new cryptocurrency will be backed by fiat money. The operational system governing the new e-currency will be separate from Facebook’s app system, but users will be able to use it with the same login. Some technology experts have expressed grave concerns on Facebook’s new project.
Concerns Regarding Libra
Like its predecessors, the Libra is a form of E-money which means that it will use a computer-based mainframe system. In the past, such system regardless of what the level of security was have been compromised and the people who have used them have ended up losing much more than than just their money.
Customers or users have had their entire vaults or accounts in the real world, and the digital world cleaned with no chance of recovery as the thief’s had left no trace.
The Way Of The Future
The way digital technologies are advancing and the new techniques that are being invented a single person can crash the entire system in moment’s notice. As current stats are suggesting the future of banking will be e-money or paperless money various governmental and business institutions will be heavily dependent on these systems.
Now if this system got hacked and the security agencies somehow fail to detect the hack the company may use it to monopolize the system and drive other competitors out of business or even worse force the government to bend to its will effectively destroying the governance system.
It Provides Facilitation To Both The User And Scammer
David Markez Facebook’s Head of Calibra in an interview said this system will be an open yet secured payment transfer system meaning that all transactions can be viewed by the police which is a big deterrent within itself. He further added that the company would reimburse the user if his or her account got hacked.
For many experts, this is still not good enough, according to one expert despite having reliable security systems Facebook accounts still get hacked, and people get extorted into buying things from various ecommerce websites to get their accounts controls back. There are numerous reports of hackers and scammers using PayPal or iTunes to scam people out of their money despite having strong security.
Reports of people getting scammed through bitcoin have also emerged. Where the new system will provide people with ease of conducting a financial transaction and give greater reach, it will also facilitate scammers and thieves. The Libra might be a new cryptocurrency with positive ambitions but if these problems are not adequately addressed the system at one point or another is bound to fail.