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Facebook has launched a white paper today for it’s planned cryptocurrency – Libra

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11 things you need to know:

  1. Libra’s mission is to enable a simple global currency and financial infrastructure the empowers billions of people.
  2. Libra is a stablecoin which will launch in H1 2020. This will be fully backed by a reserve of real assets (a basket of bank deposits and short-term government securities). The balance of the basket can be changed if needed to offset major price fluctuations.
  3. Facebook won’t control Libra. They get one vote like other founding members of the independent Libra Association headquartered in Switzerland. This provides a level of decentralization and they hope to have 100 well geographically distributed and diverse members by launch. Other founding members include MasterCard, Visa, PayPal and Uber as well as not-for-profits such as Women’s World Banking and academic institutions. They have all invested $10million each.
  4. It is built on the Libra blockchain which is open-source and any developer can build smart contracts using the Move code language. Move was created to prevent assets from being cloned, to facilitate exchange into fiat and to make it easier to write blockchain code that follows an author’s intention without introducing unintended bugs. The prototype of the blockchain – the testnet – launched today so it’s in beta mode until the launch in H1 2020.
  5. The Libra blockchain is managed by nodes, which are servers that help operate the blockchain. Each founding member operates a validator node. The blockchain follows a Byzantine Fault Tolerance (BFT) consensus approach which means that only two thirds of the nodes need to come to consensus that the transaction is legitimate and for it to be executed and written in the blockchain. Transactions incur a tiny cost to pay for ‘gas’ that covers the cost of transferring funds – similar to Ethereum.
  6. Currently, the Libra blockchain is ‘permissioned’ i.e. only entities that fulfil certain requirements can participate in the group that governs the blockchain. The goal is to move to a permission-less system in 5 years based on proof-of-stake. This will protect against attacks by distributing control, facilitating competition and lowering the barrier to entry. The aim is for 20% of votes in the Libra Association to come from node operators based on how much Libra they hold rather than being founding members.
  7. Facebook has launched a new subsidiary called Calibra. It’s first product will be a digital wallet so people can save, send and spend Libra. The wallet will be available in Messenger, WhatsApp and as a standalone app. It is expected to launch in 2020.
  8. Facebook has said that they will ensure that Calibra protects users’ privacy by never mingling Libra payments with Facebook data so it cannot be used for ad targeting etc.
  9. The Libra Association will encourage the listing of Libra on multiple regulated electronic exchanges around the world.
  10. The Libra Association will also work to sign up businesses to accept Libra for payment and will work on programmes to encourage more developers and merchants to work with them. It plans to use incentives – probably Libra coins – to pay node operators when they sign up people to use Libra. Companies earning these incentives can either keep them or pass them onto their users in the form of free Libra coins or discounts.
  11. You will spend and own Libra through Libra wallets such as Facebook’s own Calibra wallet, but also we expect others to build compatible wallets including Association members like PayPal or Spotify. Their goal is to make sending or paying money as easy as sending a Facebook message.

eToro’s view:

  • This is a seismic moment for global finance.
  • It is the first time that we have seen a tech giant and one of the FAANGS make a significant move into finance using crypto by launching a decentralized, blockchain, which will be available to billions of people.
  • We are pleased to see that it is open source and decentralized.
  • We look forward to listing Libra on eToroX, our crypto exchange, and eToro.com our trading and investment platform with over 11 million registered users across 140 countries.
  • We believe that this is just the beginning. We expect other tech giants to follow suit helping to realize the potential for blockchain to disrupt traditional financial services.
  • eToro will continue to play a key role in this revolution as we work to open up money to everyone around the world.
  • With over 2.5 billion people unbanked in the world, and the majority of the global population using less liquid or inefficient local currencies, there is a great technological opportunity to connect billions of people to one economy through a currency powered by technology.
  • With 2 billion users, Facebook has the potential to create one of the largest financial platforms in the world.
  • Crypto adoption is about more than money. It’s about global and local politics and the separation of state and money. It can be a powerful tool – hopefully for good.
  • Facebook’s Libra could mean greater financial inclusion and greater access to the digital economy.
  • Libra’s mission echoes that of eToro’s GoodDollar. The difference is that GoodDollar will distribute money using the principle of universal income (UBI). GoodDollar is 100% not for profit.
  • A remaining weakness of the crypto ecosystem is the usability and user experience (UX) which is still quite technical. There are a lot of startups working on creating a better UX for crypto and we expect this to evolve quickly as we move closer to mass adoption.

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Bitcoin of 2020: On the Rise, Better Established, and Much More Stable

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Why Bitcoin is Continuing to Climb, from More Solid Ground Than Ever

Last night saw Bitcoin once again soaring up the market, with a 6% increase over the course of three hours. This continues a fantastic start to the year for the world’s largest decentralized currency, which is up 30% since January 1st, and pulling along with it several other primary cryptocurrencies, including Ether, Litecoin, Ripple, and Dash.

A Significant Moment for Bitcoin

January 2020 is certainly proving highly significant for Bitcoin. The sharp increases and painful falls of the past pale into comparison with now, as the current increase seems to come from a far better-established position with much more stability. Furthermore, the activity around Bitcoin is expanding in exchanges, banks, and other financial institutions, together with its legitimacy and relevancy.

World Economic Forum 

Last week, at the World Economic Forum annual summit at Davos, Switzerland, Bitcoin, cryptocurrencies, and blockchain technology were honored guests. Many of the billionaires, bankers and treasury ministers who gathered in Davos are still fairly skeptical about the decentralized economy, but despite this, they also realize that they cannot stop it.

The World Descends into Chaos, And Bitcoin is on the Rise

It seems that the more agitated the world agenda, the more Bitcoin’s popularity grows, and strengthens its status as a hedge against the traditional markets. The continuous climb of the stock…

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World’s Richest 22 Men Are Worth The Same As All 325 Million Women In Africa — New Oxfam Report Reveals

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“Wealth inequality remains shockingly high.” This is the sobering conclusion of Oxfam’s latest report, published on the eve of the World Economic Forum Annual Meeting 2020.

The 162 richest people on the planet boast the same wealth as the poorest 50 percent — 3.85 billion — in the world.

From Tuesday, January 21, close to 3,000 delegates — including 53 heads of state — from 117 countries, will participate in the WEF summit in Davos-Klosters, Switzerland. According to the website blurb, the WEF Annual Meeting is “the foremost creative force for engaging the world’s top leaders in collaborative activities to shape global, regional and industry agendas at the beginning of each year”.

This year’s topic, for the great and the good of the business world and politics, is “stakeholders for a cohesive and sustainable world”. While the hellish fires raging in Australia fan the flames for climate change, the perverse irony that most of the 774 public speakers will have been flown into the summit will not be lost on the people who are truly concerned about the heating of the world.

Similarly, that many of the wealthiest people in the world will gather to no doubt use the WEF platform to further boost their richest, through additional business deals and contacts, while vowing to help those less fortunate is alarming to Oxfam. Hence…

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Cryptocurrency Prices Rally Towards Double-Digit Gains in 2020

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The cryptocurrency market has started 2020 with a huge bang, expanding by an impressive 23% within the first two weeks of the year. The overall market capitalization of the cryptocurrency market – a measure of the size of the market – has grown from $192 billion at the start of the year, to well over $240 billion by the middle of January.

Leading the pack is Bitcoin (BTC), which constitutes more than 65% of the overall market size. Going from just under $7,200 at the end of 2019 to a high of $8,800, Bitcoin recorded double-digit gains within two weeks. January 14 saw a spike of more than 11% in Bitcoin’s price, fuelling speculation that the two-year-long cryptocurrency recession could finally be over.

Bitcoin Price Chart

Among the many factors that contributed to Bitcoin’s price increase was the geopolitical upheaval emanating from increasing tensions between the USA and Iran, which led to a flight of safety capital by investors, to safe-haven assets such as gold. Already established as a manifestation of digital gold, it seems hardly coincidental that the prices of both gold and Bitcoin went up.

Another catalyst for the increase was the official launch of the CME Bitcoin options on January 13. The…

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