After Visa, Mastercard, eBay, Stripe and Mercado Pago, founding members of the Libra Association, announced on Friday that they are abandoning the Libra cryptocurrency project. Around thirty blockchain companies and different organizations non profit plan to launch a fork of Facebook's Libra project to create your own rogue version called OpenLibra.
While Facebook's next cryptocurrency Libra is struggling to please its partners and regulators, This alternative hopes to address some of its potential shortcomings. Announced at the Ethereum Foundation Devcon 5 conference in Osaka, Japan, OpenLibra is described as an 'open platform for financial inclusion', with a special twist: 'Not managed by Facebook'.
OpenLibra claims to be technically compatible with Libra, which means that anyone who creates an application on the Libra platform should also be able to easily implement it on OpenLibra. The value of the OpenLibra token will be indexed to the value of the Libra token. “Our strategy is to exploit the strengths of Libra, but extend it where necessary. OpenLibra is technically and financially compatible, embracing what is powerful.
“OpenLibra is a technology platform and a motto for financial inclusion. An alternative to Facebook's Libra, which focuses on open governance and economic decentralization. The OpenLibra project is an informal collective of individuals. We have no "association members," "partners," "employees," or "leaders." We belong to blockchain projects and some of the best non-profit foundations in our category and we are working on a native crypto solution for Libra.
The editors note that, as designed, the Libra platform:
- It will be distributed but not decentralized (as it will be controlled at all times by Facebook)
- requires permissions to interact with it
- will have no guarantee of confidentiality
- It will be led by a plutocracy (government of the luckiest).
Editors point out that a number of Libra characteristics are helpful and they can even transform the most vulnerable. But your stated plans can lead to disturbing results.
Libra would be governed by a closed group of companies. People around the world, even if they are not Facebook users, will be part of the Libra network, but will not have direct recourse to the association's policies. If Libra becomes the central bank of the Internet, it becomes urgent to establish a more inclusive form of government.
The value created within the Libra ecosystem will be captured by the few companies that are already part of the consortium. To date, Facebook has no intention of including more partners in the consortium or redistributing the revenue with more.
“Despite opposition from nation states, we believe Facebook will likely achieve its goal. OECD governments will focus on their own results and actually have little legislative power to oppose a transnational force like Facebook's Libra. For this reason, we created OpenLibra.
While Libra will be an authorized blockchain (which basically means that only authorized parties will be able to run a Libra node), OpenLibra will be permissionless from the start. There is also a significant difference in governance.
How OpenLibra will be governed is not entirely clearBut the project's 26-person core team includes people related to cryptocurrency projects like Ethereum and Cosmos.
Lucas Geiger, co-founder of crypto startup Wireline (and member of the core team mentioned above), presented the OpenLibra project on Tuesday at the Devcon scene. According to CoinDesk, it said that the individuals and organizations running OpenLibra had "less regulatory responsibilities than Facebook" and that the members were decentralized "not only geographically, but also politically and economically."
Regarding financing, Geiger says that project expenses are initially covered by a grant from the Interchain Foundation, which supports the developers of Cosmos and that other grants will be paid.
So far, The OpenLibra project has released an unauthorized version of the Libra virtual machine on GitHub. Unlike Facebook's Libra, the code calculations in OpenLibra, called "MoveMint", run on Tendermint blockchain software specially designed for use on public platforms.