Facebook's plan to revolutionize how money works, and why companies and lawmakers are so worried about it, explained in 30 seconds
Here's a 30-second explanation of what Libra is:
Libra is Facebook's attempt to create a cryptocurrency, basically: digital money.
The Libra Association will monitor Libra. The independent non-profit will be based in Switzerland and composed of 100 companies, academic institutions, and other organizations. Currently, the association has 21 members including Uber, Lyft, and Spotify. It has lost seven since members since June, including PayPal, MasterCard, and Visa.
Calibra, a Facebook subsidiary, will serve as a digital wallet for users to send and receive Libra and other cryptocurrencies.
What's the problem?
Mark Zuckerberg told lawmakers in October that, "the idea behind Libra is that sending money should as easy and secure as sending a message." Libra, and digital wallet Calibra, could serve as a digital, financial architecture that brings banking to the underserved, according to Facebook.
Lawmakers are wary that a corporation wants to create a currency. Facebook CEO Mark Zuckerberg and head of Calibra David Marcus both testified before the US House Financial Services Committee in October and July, respectively, to answer this question.
"The committee questioned Zuckerberg on issues such as whether Facebook should be trusted to handle financial data, why Facebook wants to develop a new digital currency instead of using the dollar, how Facebook is working with regulators and lawmakers, and whether or not it's willing to shelve the project if necessary," Lisa Eadicicco wrote for Business Insider about the October hearing.
Here's a 5-minute timeline from the present to Facebook's Libra announcement, via our past coverage.
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