Ethereum co-founder Joseph Lubin said that Facebook’s Libra token is like “a centralized wolf in a decentralized sheep’s clothing” in an article published on tech news outlet Quartz on June 21.
The social media giant released the white paper for a its cryptocurrency dubbed Libra earlier this month to mixed reviews from experts in the cryptocurrency and blockchain industries and concern from government regulators.
In his article, Lubin notes that Libra’s white paper describes feelings common among many in the cryptocurrency community. It states that “sending money across the globe should be as simple and inexpensive as sending a message on your phone,” and “financial infrastructure should be globally inclusive and governed as a public good.”
While noting the white paper’s claim that “People will increasingly trust decentralized forms of governance,” Lubin pointed out the need for users to trust Libra’s fiat currency and government bond backing, and merchants to trust that the network be responsibly run. Furthermore, Lubin also noted its centralized infrastructure:
“Perhaps most importantly, it requires our trust that Libra will eventually transition to a more ‘permissionless,’ decentralized system, whereby anyone can validate the network, rather than the restrictive member evaluation criteria keeping control in the hands of the initial 28 firms.”
Still, Lubin admits that he sees some good in the project. He says that in a few years there could be two billion Libra users, and cryptocurrency user experience (UX) could be vastly improved in the process:
“In one fell swoop, talented UX designers could reduce the current friction of using cryptocurrency. Managing private keys, understanding ‘gas payments,’ and installing crypto browser plugins could be as simple as pressing ‘send’ in WhatsApp, another Facebook-owned entity.”
Lubin also claims that developers at Ethereum-centric development company ConsenSys already analyzed the code and noticed that the project borrows a lot of ideas from Ethereum. Lastly, he notes that he expects Libra to be well-executed from a technical point of view.
As Cointelegraph reported yesterday, the governor of the Reserve Bank of Australia, Philip Lowe, cautioned that Facebook’s announced Libra currency may not attain mainstream usage in the near future.
Also, earlier this week a G7 taskforce was created to examine how central banks can regulate cryptocurrencies.