As CNBC reports, today, Facebook’s Kevin Weil, vice president of product at Facebook’s Calibra digital wallet unit, said that Facebook’s digital cryptocurrency Libra will not spread as quickly as a social media platform. He thinks it will take decades to become as popular as Facebook.
Weil said at the ‘Web Summit’ tech conference today: ‘This is not going to be a thing that spreads like a social network. This is going to be the work not of years but of decades, and it’s worth making.’
Since the Libra project was first announced in June this year, Facebook has been under tremendous regulatory pressure. The Libra Association is a Switzerland-based consortium overseeing the project. Last month, it lost multiple key initial backers including Mastercard and Visa.
But Weil seems optimistic that other companies will join the Libra Association. He said: ‘18 months ago, this was an idea. Today we have 21 fantastic committed organizations that are members of the Libra Association; a bunch more that are looking to be involved. So expect that number to continue to grow.’
Libra’s value will be tied to a basket of government currency and debt to maintain its stable value. Thus, it will perform like many so-called ‘stablecoins’ designed to avoid the volatility of digital cryptocurrencies such as Bitcoin. Facebook said its main use will be for remittances. So consumers can send money across borders.
The Facebook executive also said that Libra will solve some of the current problems with foreign exchange payments. For example, the average cost of current remittances is about 7% of the total transaction amount.