Opinion: How to seize the opportunity of Facebook Libra

Libra's mission is to create a simple, borderless currency and financial infrastructure that serves billions of people. — Libra White Paper


On June 18, 2019, Mark Zuckerberg (1984-), the founder of Facebook, the world's largest social networking site with 2.7 billion users, publicly announced the Libra project website (https://libra.org) On the line, the white paper was officially released. This is just a decade since the inception of the Bitcoin main online line.

Unlike JPMCoin, which was not "money" issued by JP Morgan Chase recently, Facebook generously and frankly pointed out in the white paper that Libra is (to become a kind of currency).

Overnight, the blockchain and cryptocurrency suddenly entered the room from a corner that was scorned by the mainstream society and entered the public's field of vision. Many people began to seriously examine the bitcoin and blockchain industry, and suddenly found that Bitcoin has quietly broke through the price of 10,000 US dollars. After all, the strength of Facebook with 2.7 billion digital residents can not be underestimated, and its groundbreaking attempts to jointly launch non-state currencies with leading companies will also go down in history.

Many people regard the Libra coin as the second milestone in the history of blockchain after ten years of Bitcoin. Since then, humanity has entered the post-US dollar era. Various analysis, imagination, and predictions are emerging one after another. The global pattern of human monetary finance is bound to usher in earth-shaking changes.

In the face of such a major historical event, the macro-literature has been written for each family. This article is a unique way, focusing on small places, grounded to the readers to analyze, how to seize the big opportunity and big opportunity of the Libra coin?

I. Investors: How to seize the industry dividend brought by Libra

Some people say that when Libra is officially launched in 2020, can you buy some investment? The answer is of course no. Because the white paper says that Librae is a stable currency and that it has no interest, it is certainly not a good investment method to buy Libra.

So what are the opportunities and methods that can be invested? The teaching chain (public number: blockcoach) tells you three ways:

1. Method 1, join the Libra Association. This method is applicable to institutions that meet the requirements.

This is the most direct way to enjoy the rights and is the highest method of the threshold. According to Libra's white paper, “Board members jointly make decisions on the governance of networks and reserves” and as “investors in the early stages of ecosystem start-up” enjoy the “dividend” benefits paid by “interests on reserve assets”.

Join the threshold [1]:

  • $10 million initial fee to purchase Libra's Investment token;
  • $4 billion in market value, or more than $500 million in customer deposits;
  • Serving more than 20 million customers in many countries around the world every year;
  • Recognized as a global Top100 industry leader;

For entities in the blockchain industry, there are preferential conditions:

  • (Encrypted Capital) manages assets of more than $1 billion;
  • (Blockchain companies) host or pledge more than $100 million in client assets.

2. Method 2: Buy Facebook stock. This method is applicable to US stock investors.

If the Libra plan is successful, then Facebook is clearly one of the biggest winners. If you don't meet the standards of the Libra Association, you can transfer to the US stock market to buy stocks of Facebook (or other members of the Libra Association with dividends), or indirectly share Libra's dividends.

3. Method 3: Buy and hold Bitcoin. This method is applicable to the general public worldwide.

If Satoshi Nakamoto is Columbus and Bitcoin opens up the New World of the Americas, Libra is the Mayflower that leads to the New World of the Americas.

The shareholder who wants to be a ship has a high threshold. If you want to buy a ticket, you need a US stock account and a US dollar. For ordinary people all over the world, there is a minimum threshold and the easiest way to share the bonus of the Libra. That is to buy bitcoin.

Thanks to Nakamoto's foresight and insight, 10 years ago, it accurately predicted the booming of Internet payments today, and laid out in advance to prepare a kind of cryptographic asset that is truly civilians – Bitcoin.

Obviously, Librae will bring two direct benefits to Bitcoin: the first is good, it reverses the public's perception of cryptocurrency and expands the popularity of Bitcoin; the second is good, Libra coins open the encrypted world. And the ordinary world, the number of users of Bitcoin reached from 30 to 40 million to hundreds of millions.

Second, Internet entrepreneurs: a new model of subverting the classical Internet

The business model of the classical Internet for thirty years is in a nutshell: traffic is realized.

Whether it's portal and media CPM, search engine CPC, e-commerce CPC/CPS, or social-to-game CPM/CPC/CPA, it's all about spending money, collecting user privacy big data, precision advertising targeting, traffic change Revenue. Among them, the trade-off is profit and ethics, the game is KPI and user experience, it is difficult to give up the greedy collection of user privacy data.

This is the pain of Facebook's personal experience. To provide free services, you have to advertise. To make an advertisement well, you must violate user privacy. When Facebook founder Zuckerberg received dozens of hours of inquiries during a congressional hearing, he made up his mind to break through this flawed business model of the classical Internet.

He found the blockchain.

In Libra's white paper, Libra's profit model was very frankly explained, and there was no such thing as a mystery. Unlike some experts who speculate that Libra needs to make a fee to collect fees, Libra's profit model is very clear – making money from the appreciation of reserve assets.

Libra is a stable currency that does not require acceptance. Unlike bitcoin, a volatile currency, stable currencies do not have the ability to absorb value growth from market volatility. In other words, stable currency has no inherent value growth.

When a user exchanges a purchasing currency (such as US dollars) for Libra, it is equivalent to transferring purchasing power to the Libra Association. The Libra Association can take the “free” exchange of purchasing power from the user to “buy and buy” the world and acquire quality assets. And the appreciation of these high-quality assets, a penny will not be returned to Libra's holders, and is completely shared by Libra Association members, or the holder of Investment token.

This is a business model that surpasses Buffett, the world's richest man.

As a model of success for long-term value investors, Buffett’s model is to exchange the insured’s huge amount of floating deposits through the reinsurance business, in exchange for the commitment to undertake insurance compensation obligations, that is, the money that does not generate claims for the time being. The money can be thought of as likely to be used for claims in the future – if the risk occurs, but at the moment it can be dominated by Buffett. So Buffett can use these days of funds to "buy and buy", buy high-quality companies, insist on long-term holdings, and obtain huge compound returns. Why Buffett can hold it for a long time because his money is a very long-term insurance.

Go back and compare Libra. First, Buffett has to pay for insurance in order to get the money, Libra does not need to promise even acceptance, who is more profitable at a glance; Second, Buffett's floating gold is life cycle, because of the risk of continued occurrence Claims demand will continue to erode this money, and as long as Libra maintains the mobility within the ecology, its holding period of assets can be infinitely long, and it is obvious that its compounding ability is stronger.

In this way, we can understand that Buffett's model has been so profitable, Libra will only make more money. This money will not only fully support the operation of the system, but also allow Facebook to completely get rid of the advertising revenue model. In the future, information services will be free of advertisements, financial services such as cross-border transfers will be free, and so on.

The business model of the classical Internet and the classical Internet company will be hit by the business model of the blockchain digital currency empowerment.

This is Libra's inspiration and practical demonstrations for Internet entrepreneurs. The financial empowerment brought by the blockchain will be a powerful weapon for the next generation of Internet entrepreneurs to surpass the classical Internet giants.

Third, the blockchain practitioners: blockchain can have no chain, but can not have no coins

If we take a closer look at Libra's technical white paper and its open source code, we will find that Libra claims to be a blockchain digital currency, but its technical bottom layer is not a blockchain.

As commented by bitcoin evangelist Andreas Antonopoulos: Libra is not a blockchain, nor a cryptocurrency.

In the first decade after SNB’s invention of Bitcoin, a lot of people wanted to use blockchain technology to make some innovations different from Bitcoin. So people made some cuts:

1. Cut the currency;

2. Reduction of decentralization (anti-censorship, privacy, irreversibility, etc.);

3. Cut the chain;

In all the trials, many people tried to cut the coins and decentralized, but they all failed without exception. Everyone was disappointed to find that there is no currency, and the blockchain is just a “database” with extremely poor performance, extremely low flexibility, and extremely monotonous functions. In these solutions, replacing blockchains with traditional databases tends to improve system performance without losing any other significant advantages.

Facebook is obviously very pragmatic. For the alliance chain system like Libra, the currency, as well as the programmable features (Libra's newly invented smart contract language Move), are the most important. Under this, you only need to use the BFT (Byzantine Fault Tolerance) algorithm to do a distributed database with multi-agent participation.

This is what Libra brings to the blockchain practitioners – the only important thing that can't be cut in the blockchain is actually the currency. Don't go farther and farther on the wrong road, be obsessed with it, and waste your life.

Fourth, the alliance chain enterprises: infrastructure new weapons

Many enterprise-level blockchain application scenarios are closer to the coalition chain paradigm than to the public chain paradigm.

The public chain is a completely open network with no permission threshold, and everyone can participate freely. The alliance chain is a semi-open network, and the service nodes are licensed, just like the member nodes of the Libra Association, and the majority of users who are served can enjoy the service for free.

Previously implemented the alliance chain, either choose open source software that specifically targets the alliance chain, such as Hyperledger, or choose the public chain code and carry out customized secondary development, such as the common modification based on Ethereum.

Now, we have an open source code that may be more in line with the alliance chain paradigm and application scenarios. Libra source code allows us to quickly and better land the alliance chain application and push the alliance chain to work in all walks of life.

This may greatly reduce the cost of implementing the alliance chain of the entire industry, thereby releasing the development potential of the industry. For alliance chain companies, if you study Libra's source code, you may get twice the result with half the effort and seize the dividend of industry development.

V. Short: Traditional financial basic service providers

Once Libra is popularized, who will be affected or even subverted?

Cross-border payment service providers, banks, weak countries with unstable French currency, and even, in the long run, the dollar hegemony that dominated the global financial order for decades has inevitably been greatly affected.

After the dollar era, the dollar power hegemonic retreat left the monetary power vacuum, who will fill it? Candidate three:

1. Strong national currency in other countries – the traditional world. Who are you optimistic about?

2. Digital currency stable currency – connecting the traditional world and the encrypted world. Will it be Libra?

3, cryptocurrency standard currency – encryption world. Bitcoin.

If you reduce or even short, it is destined to decline. If you increase your holdings and do more, you have the opportunity to replace them. This is the best way to invest in the future.


At the end of the Eastern Han Dynasty, with the gradual decline of the royal family, they fought together and competed in the Central Plains. The wolf smoke is everywhere, the blood is dyed on the battlefield, and you sing me to debut, and the people are not happy. There are Cao, Liu, and Sun, starting from the chaos of the world, defeating the enemy in the wild, and the name is up to the world, eventually becoming a three-legged trend.

History will not repeat, but will rhyme. ——American famous novelist Mark Twain (1835-1910)

(End of the article)

Reference materials:

[1] https://libra.org/en-US/becoming-founding-member/

Author: Liu teaches chain (micro-channel public number: Liu teaches chain)

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