Facebook today revealed details on its much anticipated digital currency and blockchain project, termed Libra, which is expected to launch in the first half of 2020.

Given Facebook’s massive reach and how the project is backed by several FinTech and investment companies, including Mastercard, Uber, PayPal, and Andreessen Horowitz, many wondered whether Libra would compete against Bitcoin, but we believe traditional banks have more cause for concern than traditional cryptocurrencies.

Firstly, the Libra Blockchain is not truly decentralized or permissionless like Bitcoin – this means only a selected number of validators will be auditing the blockchain and users will have to trust them.

Secondly, the Libra Currency is not ‘just another stablecoin’ – the whitepaper mentions the creation of a reserve, which will consist of various assets, including bank deposits and government securities, and will provide the underlying value for the currency. This means Libra Currency will not have a peg or a fixed value and will fluctuate in its exchange rate, just like any other currency.

Interestingly, Facebook highlights that the underlying assets will include securities from stable and reputable central banks – which possibly hints at the creation of a new kind of global reserve, which will make Libra Currency more of a competition for local fiat currencies and banks rather than Bitcoin.

Libra Currency Could be Icebreaker for Bitcoin

Given Facebook’s plans for Libra, it appears that the tech giant is making a bold move towards creating a frictionless economy at a global level, where it would override the financial supremacy of governments and the sway held by banks. Its goal is similar to what Bitcoin aims to achieve, but even if Facebook succeeds in its vision, we would simply be moving from an economy centralized by governments and banks to one centralized by large tech companies.

The need for decentralization and its associated freedoms and transparency will still be unmet, and Bitcoin is much more likely to fill that gap once Facebook facilitates the transition towards true digital payments and a global currency. In effect, Facebook’s project Libra may just serve as an icebreaker for Bitcoin’s eventual adoption around the world.

All said and done, it may just be traditional banks which will be left behind as archaic institutions disrupted by technological innovations, as tech companies and digital assets become both, stores of wealth and mediums of exchange.


As of the publication date of this report, BitBull Capital Management LLC and its affiliates (collectively “BitBull”), others that contributed research to this report and others that we have shared our research with (collectively, the “Investors”) may have long or short positions in and may own options on the token of the project covered herein and stand to realize gains in the event that the price of the token increases or decreases. Following publication of the report, the Investors may transact in the tokens of the project covered herein. All content in this report represent the opinions of BitBull. BitBull has obtained all information herein from sources they believe to be accurate and reliable. However, such information is presented “as is,” without warranty of any kind – whether express or implied.

This document is for informational purposes only and is not intended as an official confirmation of any transaction. All market prices, data and other information are not warranted as to completeness or accuracy, are based upon selected public market data, and reflect prevailing conditions and BitBull’s views as of this date, all of which are accordingly subject to change without notice. BitBull has no obligation to continue offering reports regarding the project. Reports are prepared as of the date(s) indicated and may become unreliable because of subsequent market or economic circumstances.

Any investment involves substantial risks, including, but not limited to, pricing volatility, inadequate liquidity, and the potential complete loss of principal. This report’s estimated fundamental value only represents a best efforts estimate of the potential fundamental valuation of a specific token, and is not expressed as, or implied as, assessments of the quality of a token, a summary of past performance, or an actionable investment strategy for an investor.

This document does not in any way constitute an offer or solicitation of an offer to buy or sell any investment or token discussed herein.

The information contained in this document may include, or incorporate by reference, forward-looking statements, which would include any statements that are not statements of historical fact. These forward-looking statements may turn out to be wrong and can be affected by inaccurate assumptions or by known or unknown risks, uncertainties and other factors, most of which are beyond BitBull’s control. Investors should conduct independent due diligence, with assistance from professional financial, legal and tax experts, on all tokens discussed in this document and develop a stand-alone judgment of the relevant markets prior to making any investment decision.