Nice article written by Jake Yocom-Piatt about Libra
https://www.ccn.com/news/libra-friend-or-foe/2019/07/21/Libra: Friend or Foe? Worst Case Scenario Post-Congressional Hearings
Facebook is in the hot seat this week, as Congress asks burning questions about the companys Libra cryptocurrency. I use quotes, because in the purest sense, a cryptocurrency is decentralized, trustless, and permissionless. Libra is none of these. Instead, Libra is more likely to become a private currency that enables a turnkey totalitarian state with all-encompassing surveillance.
While the Libra Association is purportedly an independent, decentralized entity that governs the project, Libras consensus system is so corporate its offensive to call it a true cryptocurrency. Its effectively a meta-corporate entity, with the likes of Visa, Mastercard, PayPal, Uber and Spotify at the helm.
Facebook & a fundamental lack of trustAs far as being trustless, why wouldnt you trust Facebook? The company was recently fined $5 billion for breaching consumer privacy. Now you want to trust them with your personal data AND finances?
The term permissionless in the context of blockchains means that no centralized gatekeeper can determine whether or not you can participate in the network. The 27 other founding members of Libra paid a pretty penny to be validator nodes in the networkan initial minimum investment of $10 million worth of Libra Investment Tokens issued by the Associationand had to meet very specific criteria laid out by Facebook. These entities form an elite and centralized group of gatekeepers who will control permission on the Libra network. This is just another central planning committee.
Now Facebook can deplatform you AND your bank account, which is a super powerful tool for whomever is controlling itwhether that is big tech or government, or perhaps both. Considering Facebooks pattern of selectively deplatforming users on the basis of their political beliefs or similar, tightly integrating a payment system with Facebooks existing social media platform is an extremely dangerous proposition.
Worst case scenario: big tech and government in cahootsCorporatism, the control of a state or organization by large interest groups, sounds like an accurate description for Libra and an evolutionary step towards fascism. Libra espouses the very altruistic mission of empowering billions, especially the unbanked, with a simple, global currency and financial infrastructure. I retain a healthy amount of skepticism.
The real question is whos in the drivers seatbig tech or government? In this scenario, I see the answer as both. While this looks like a battle between legislators and big tech, the reality is that they could wind-up collaborating to create a competitor to Bitcoin that is government-regulated. I dont think its a coincidence that news outlets are asking whether Bitcoin was created by a serial criminal concurrent with the discussion of Libra.
Libra could serve the surveillance state
The US government would likely see Libra as an opportunity to surveil the public more thoroughly, similar to how WeChat has been operating in China. Libra claims it will keep transactional data separate from social data, but Facebooks track record and core competency of strip mining users privacy makes that claim implausible. This system sets up a total reversal of the essence of blockchain: instead of a new kind of banking that returns the power to the people, Libra sets up the ultimate surveillance state.
The social credit system in China, where every single action you take is tracked by the government and rolled into a social credit score is exactly where Libra is headed. Libra would be one more step on the road to a totalitarian state, one in which the government sees your every move and tracks your every dollar. Its easy for the government to act like a neutral or even antagonistic party questioning Libra in Senate hearings.
Behind this veil of congressional mistrust of big tech lies enough powerful interest groups and venture capitalists to benefit from a symbiotic relationship, whereby they acquire and monetize data that allows the government insight into every citizens lifelog. Furthermore, the possibility of code-based, behind the scenes monitoring via cameras and microphones embedded into every citizens hip pocket render the wiretapping and telecom scandals of the past tame in comparison. Ultimately, once the technology is widely adopted, the government stands to reap the benefits.
Is the tar and feathering of Bitcoin and congressional outrage a cover for the Trojan horse public-private conspiracy to install a renewed version of the US Defense Departments lifelog, an effort canceled in 2004 (the same year Facebook was founded) to build a database tracking a persons entire existence? Only time will tell.
by Jake Yocom-Piatt
