Facebook proposes a blockchain currency called Libra

A blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value. A few days ago, Facebook announced its plans for a blockchain solution. In terms of using blockchain for virtually anything of value, tech-savvy CTO, Jameson Lopp, believes that Facebook's blockchain will be used for more than just digital currency. He even questions if Facebook's solution, called Libra, is even a blockchain.

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• Facebook has partnered with VISA, Mastercard, PayPal, eBay, Uber, Lyft, and Spotify in this venture. With significant players that will accept this cryptocurrency, it may have a fighting chance.

• As the distinguishing characteristic of a blockchain is that it is not beholden to a single entity, Libra is governed by a nonprofit, called the Libra Association, instead of by Facebook itself. The primary tie between Facebook and Libra is Calibra whose mission is to provide a connected wallet for a connected world. I guess the end-game is for Facebook to provide a shopping experience as part of connecting users with their friends. "Your friend Joe just bought THIS. Wouldn't you also like to buy THIS? Click here."

• Another characteristic of a blockchain is that nodes on the chain validate the transactions before they get added to the block. Facebook will only be one of a hundred nodes, and as such, will not have more than 1% of the voting power to approve a transaction. In this way, users of the cryptocurrency won't be beholden to Facebook.

• Libra includes a stock transfer order coined as a Libra Investment Token. Companies that want to be validators of Libra transactions must buy at least $10 million worth of Libra Investment Tokens. Their operating costs are expected to be $280,000 per year. The point here is that Libra will be backed by some serious financial capital which may improve the public's confidence in using the cryptocurrency. This backing should also help to stabilize the cryptocurrency's value.

• To show that everything is on the up and up, the blockchain code for Libra is open source. It is developed and maintained by a community of developers that don't all work for the same company. The source is available to the general public on GitHub. Libra is written in a programming language called Move whose emphasis is to make the code easy to understand. It can be thought of as the COBOL of JavaScript. The Move language itself is open source and available on GitHub. In this way, consumers considering using the cryptocurrency can feel secure that the cryptocurrency and the language used to create it are under the scrutiny of many eyes.

Autodesk Research has been investigating blockchain technology for some time. The key to leveraging blockchain for the Architecture, Engineering, and Construction industry will be the smart contract. A smart contract is a set of rules that programmatically get triggered when events happen. For example, when the framing is completed on a house as indicated by the city's building inspector, the framer gets paid by the builder. These are the types of events currently emanating from a Building Information Model (BIM) created by Autodesk customers using Revit and managed by project teams using services like BIM 360 or PlanGrid. As such, Autodesk Research will continue to watch Libra as it develops. Libra is scheduled to launch in 2020 but is not a fait accompli as it is uncertain if governments will cede tight control of the financial system?

“The Libra announcement marks the starting point of the ensuing battle that will take place in the next few years where nation-states, big-tech, and the crypto world will endeavor into these stormy waters of a new financial system where borders and control will become fuzzy. The flows of money and financial assets will shift power in ways that will reverberate across industries and businesses that all started with the disruption caused by the Internet where the control of information started to decentralize, and now we will see the control of power (money) to do the same. This will cause major changes in the status quo.”
— Andy Nogueira, Senior Principal Developer for Autodesk Research

As Facebook has a different business model from Autodesk in terms of customer data, some consumers have a trust issue regarding Facebook. Facebook is partnering and backing Libra with significant capital to help instill trust. In some ways, blockchain is the "automation of trust."

Autodesk has always been an automation company. Today, more than ever, that means helping our customers automate their design and make processes. We help them embrace the future of making, where they can do more (e.g., efficiency, performance, quality), with less (e.g., energy, raw materials, timeframes, waste of human potential), and realize the opportunity for better (e.g., innovation, user experience, return on investment). A frictionless payment system provides the opportunity for better, so Autodesk will continue to pay attention to how Libra unfolds. To get the gory details on Libra for yourself, check out the Libra White Paper.

Cryptocurrency is alive in the lab.