Ethereum co-founder Joseph Lubin said that Facebook’s Libra token is like “a centralized wolf in a decentralized sheep’s clothing” in an article published on tech news outlet Quartz on June 21.
The social media giant released
the white paper for a its cryptocurrency dubbed Libra earlier this
month to mixed reviews from experts in the cryptocurrency and blockchain industries and concern from government regulators.
In his article, Lubin notes that Libra’s white paper describes feelings common among many in the cryptocurrency
community. It states that “sending money across the globe should be as
simple and inexpensive as sending a message on your phone,” and
“financial infrastructure should be globally inclusive and governed as a
public good.”
While noting the white paper’s claim that “People
will increasingly trust decentralized forms of governance,” Lubin
pointed out the need for users to trust Libra’s fiat currency and
government bond backing, and merchants to trust that the network be
responsibly run. Furthermore, Lubin also noted its centralized
infrastructure:
“Perhaps most importantly, it requires
our trust that Libra will eventually transition to a more
‘permissionless,’ decentralized system, whereby anyone can validate the
network, rather than the restrictive member evaluation criteria keeping
control in the hands of the initial 28 firms.”
Still,
Lubin admits that he sees some good in the project. He says that in a
few years there could be two billion Libra users, and cryptocurrency
user experience (UX) could be vastly improved in the process:
“In
one fell swoop, talented UX designers could reduce the current friction
of using cryptocurrency. Managing private keys, understanding ‘gas
payments,’ and installing crypto browser plugins could be as simple as
pressing ‘send’ in WhatsApp, another Facebook-owned entity.”
Lubin also claims that developers at Ethereum-centric development company ConsenSys already analyzed
the code and noticed that the project borrows a lot of ideas from
Ethereum. Lastly, he notes that he expects Libra to be well-executed
from a technical point of view.
As Cointelegraph reported yesterday, the governor of the Reserve Bank of Australia, Philip Lowe, cautioned that Facebook’s announced Libra currency may not attain mainstream usage in the near future.
Also, earlier this week a G7 taskforce was created to examine how central banks can regulate cryptocurrencies.
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