I can’t believe it’s the last weekend of June already. Between a new job, travel, vacation, and trying to balance the new reality of my personal and professional worlds, it’s been a lightning-fast couple of weeks. On the bright side, despite how quickly the weeks have gone, it’s been a great month. I’ve had a lot of new experiences and have met some fantastic people along the way.
But it was quick.
So quick that my arch nemesis, Facebook, announced plans to launch a crypto currency, Libra, and I’ve yet to mention it anywhere. Not even a tweet about it with some snarky comment. Facebook is planning to destroy our banking industry and here I am trying to balance life. I dropped the ball on this one.
But yes, Facebook is in fact planning to launch its own digital currency sometime in quarter 1 of 2020. The idea that Facebook will launch its own digital currency isn’t really new news. This is something that has been discussed and speculated on for at least a year. However, the company detailed its plans in an announcement on June 18, 2019.
In addition to the currently, the announcement detailed plans for Calibra, a new Facebook subsidiary. Calibra will provide financial services that will allow people access and participate in the Libra network. The offerings will include a digital wallet for Libra, available in Messenger, WhatsApp, as well as a standalone app.
As the BBC points out, this is not the first time Facebook has attempted a digital currency. Facebook launched Credits in 2009, and subsequently abandoned the project in 2012. Credits seemed to have failed because it was confusing, restrictive, and well ahead of its time.
Libra is much less restrictive. Facebook’s intention is for Libra to be a global currency in the same vein as Bitcoin, and not restricted to its own platform, as was Credits. Libra is also backed by 28 founding partners including Visa and Mastercard.
If you judge this at face-value, Libra appears to have a lot going for it. A non-profit subsidiary to administer the currency and business partners in banking, tech and other sectors.
So what’s the problem?
The problem is that this bus is being driven by Facebook. No matter what shade of lipstick you put on it, what non-profit has oversight, and how many business partners are backing it, not one person in the world should trust Facebook. And if you still trust Facebook, you haven’t been paying attention.
Facebook has had a hand in decimating journalism, the proliferation of fake news, election fraud, and multiple privacy issues that they’ve either ignored or addressed with the maturity of a 12-year-old. Actually I take that back. My son is 12 and I think he would at least be more empathetic than Facebook has been.
The company has proven time after time that it cannot be trusted with your privacy, why in the world should we trust them to create and run a digital currency and international banking system?
The answer is we shouldn’t, but the reality is that we will. And it will be successful – at least until its first major scandal or hack and the European Union steps in (you don’t actually think the U.S. will crack down on any of the Silicon Valley darlings, do you?). The odd thing is that I don’t think it will be the Facebook platform or Messenger that makes it successful. Facebook’s core users are less likely to use a crypto. They skew older and were raised by a fiscally conservative generation (at least from a banking standpoint). Most of them will smartly steer clear of the risk.
It will be What’s App and Instagram that will drive the success of Libra. Both have significantly younger user bases that are accustomed to purchasing digital currency to buy digital goods. As an example, an entire generation has been raised on Xbox, PlayStation, and Steam where it’s commonplace to buy platform-specific digital currently in order buy games and in-game items. Wouldn’t it be great if you could buy a platform agnostic digital currency instead of having your funds locked within a single platform?
Seems like a relatively mundane pain point to solve, right? Why not create a little convince for folks in order to build a user base and attach millions of banking accounts to Facebook’s flawed privacy system?
What will this convince get us? With Facebook’s culture and business practice of moving fast and breaking things, they do just that. Given how that has played in journalism and elections, and the lack of accountability Facebook has shown, we could be in for a very bumpy ride.
I’m sure the banking system will be just fine though.
Roku Continues to Dominate
FierceVideo reported this week that according to Strategy Analytics Roku accounted for 30% of all U.S. sales of streaming devices in quarter 1 of 2019. Amazon was number two during the quarter, accounting for 12%. This now gives Roku 41 million streaming devices that are in use in the U.S., good for more than 15% of the market and a 36% lead over number two Sony.
It’s amazing that despite Roku being one of the first movers in the OTT market – and with massive competitors Amazon, Apple, Samsung, and Sony – that they continue to be the leaders in the streaming TV space. It’s not as though they are sitting on a lead and playing defense either. They continue to grow at an astounding pace, faster than any competitor.