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Just half a year ago, Facebook’s ambitious cryptocurrency project – Libra – shone in the lightpositive prospects and financial opportunitiesfor all interested parties. The situation has changed radically. Not only did PayPal, Visa, Mastercard, eBay, Stripe and Mercado Pago leave the project, and the US Congress completely criticized it, but also the director of the second giant Twitter network, Jack Dorsey, spoke out negatively.

He commented that Libra has nonothing to do with cryptocurrency, and during Mark Zuckerberg's speech to the US House of Representatives, there was a focus on American consumers, rather than the global audience that underlies the operation of his network. Mark Zuckerberg, although he did not respond to Dorsey's comment, said he would leave the Libra Association if the project is not approved by regulators. But he also emphasized that this organization is independent and can independently promote the project.  

Libra  – death or salvation of the global financial industry

In the summer of 2019, an active user baseFacebook amounted to 2.41 billion people worldwide. If you also take into account users of Instagram and WhatsApp, owned by Mark Zuckerberg, the number of possible Libra customers exceeds the population of even such populous countries as India or China. The head of the Libra Association himself positions this as a great opportunity for millions of people to pay with a stable blockchain tied to a basket of the most widely used fiat currencies like the US dollar, Japanese yen, euro, Singapore dollar and British pound. After all, with the help of Libra, users will be able to send money to each other, pay for goods and services within Facebook services.

However, the authorities view it completely differently.launching a stablecoin, fearing negative consequences. According to US congressmen, a private company that has turned into a giant financial institution can become a competitor for entire countries. If we add to this the negative reputation of the Zuckerberg network regarding the storage and use of personal data of users, as well as the threat of money laundering and terrorist financing, it becomes clear why regulators from literally all corners of the world are categorically opposed to the launch of Libra. 

Cryptocurrency path Twitter 

In 2009, the founder of Twitter launched anotherone technology giant, Square, to receive and process electronic payments from credit cards via smartphone or tablet. As of 2014, the company processed 446 million payments with 144 million cards for a total of $ 23.8 billion. In 2017, Square added the ability for users of their mobile app Cash App to purchase, sell and transfer bitcoins to other wallets.

This winter, Jack Dorsey after holdingThe Lightning Torch charity event announced that it will definitely implement the Lightning Network second-level Bitcoin protocol in its Cash App payment application. It is worth noting that the action was held to demonstrate the capabilities of the Lightning Network, which aims to solve two main problems of the Bitcoin blockchain: lower cryptocurrency transfer fees and speed up transaction time.

Some time later the founder of twotechnology unicorns acquired a Lightning node from the Casa company, and to carry out micropayments Bitcoin from the Lightning Network on the Twitter network introduced the Tippin service. In addition, this summer Square introduced Bitcoin deposits into the CashApp application. It is obvious that Jack Dorsey's cryptocurrency payment solutions do not involve the creation of his own cryptocurrency, but are aimed at improving and improving the existing one, to which he is fully committed. – bitcoin. 

Jack Dorsey's beliefs versus Mark Zuckerberg's wishes

Jack Dorsey, unlike Mark Zuckerberg, is notaims to create his own cryptocurrency, and implements projects around Bitcoin. He has repeatedly stated that he sees it as the future native currency of the Internet. In a podcast with Joe Rogan, he said this:   

“I am convinced that the Internet will havenative currency. My guess is that Bitcoin has the potential to become one, given the trials it has been through and the principles it is built on. It was born on the Internet, developed on the Internet, and stood the test of the Internet.”

At one of the events in New York, Jack Dorsey also commented on Mark Zuckerberg's speech to the US Congress:

“Libra is not based on an open standard,born on the Internet, but from the personal intentions of the company, which is neither what I personally believe in nor what I want our company to stand for”. 

He also said that much of whatsaid the founder of Libra, is based on American traditions, a concept that could make it impossible for Twitter to experiment and expand as it “serves a global audience.” In the end, Jack Dorsey said that he was not considering the possibility of joining Libra, and the project itself did not consider it a cryptocurrency at all. 

Meanwhile, Mark Zuckerberg has a different visionon the cryptocurrency future and its prospects. In his opinion, Libra will be stable, unlike Bitcoin, as it will be backed by a basket of fiat currencies. In addition, he believes that now “people pay too high a price for transactions and have to wait too long for them to complete,” and Libra will make transfers and payments safe and fast for everyone who does not use bank accounts for various reasons.  To date, the Facebook CEO's arguments have been decisively rejected by world governments.       

Libra implementation

During Mark Zuckerberg's acclaimed speechbefore the US House of Representatives, members of Congress asked why key companies such as PayPal, Visa, Mastercard and eBay withdrew from the project. To which the head of Facebook replied that this is “a risky project that is subject to close scrutiny.” From previous information, it is known that it was Senators Brian Schatz and Sherrod Brown who threatened these companies with "close scrutiny not only of payment transactions with Libra, but of all others." Mark Zuckerberg defended his position by saying that he wants to provide fast and accessible payments for those who, for various reasons, do not have bank accounts.

What Congressman Brad Sherman stated:

"You, the richest man in the world, comecome here and hide behind the backs of the poorest people in the world. And say that you are trying to help them. In fact, you are trying to help those for whom the dollar — not a very good currency: for drug dealers and tax evaders." 

Members of Congress also pointed out to Mark Zuckerbergall of Facebook's previous failures. To which he admitted the existence of many shortcomings in recent years and that  “A lot of people would like someone else to come up with this idea but Facebook.”

At the same time, the director of the platform assured thatwill support the launch of Libra only if all approvals from financial regulators are received. To which they, in turn, asked, “how will Facebook behave if the majority of partner votes are in favor of launching Libra without the appropriate permissions?” Facebook CEO responded that he would leave the Libra Association in this case and would be forced to leave the project.     

We can clearly see in the example of CEO Twitter thatit is not necessary to create your own cryptocurrency in order to bring technological innovation to the real world. At the same time, it is obvious that megaprojects such as Libra Facebook bring a huge amount of difficulties to their implementation. Whether this will turn out to be a useful means of payment for peaceful users or an ideal weapon for terrorists, apparently, remains an open question not only for Mark Zuckerberg himself, but also for all state authorities.

And despite the fact that in connection with the latestsituations, it is quite difficult to predict how events around Mark Zuckerberg’s stableblock will develop, we can say with confidence that such a large-scale decision will have a significant impact not only on the entire cryptocurrency industry, but also on the entire global financial market. It remains to be seen whether the Libra Association will come to a positive consensus with the government of the United States and other countries, or whether they will begin to launch the project on their own, despite all the prohibitions.  