31. 25/06/2019 08:04
A Monumental Fight Over Facebook’s Cryptocurrency Is Coming

Given how slowly Washington lawmakers have taken to devise a coherent, informed view of cryptocurrency, the Chair of the House Financial Services Committee’s rapid leap to action last week over Facebook’s ambitious Libra project was remarkably fast.

But let’s reflect not on the details of Rep. Maxine Waters’ (D-Calif.) urgent requests that  Facebook to cease work on Libra until after hearings are held or on how European lawmakers made similar appeals. The important takeaway from these legislators’ actions is that they are able to make such demands at all. since this is not the case with truly decentralized projects.

Unlike with bitcoin, representatives in Congress can directly identify and talk to the people in charge of the Libra project. They can subpoena them and, thus, pressure them. They might start with David Marcus, head of Facebook subsidiary Calibra, but, ultimately, it’s Facebook CEO Mark Zuckerberg who’ll give lawmakers the greatest leverage.

In this case, the buck stops with Zuck.

Now, imagine a Congressional leader calling for a halt in bitcoin development. Who exactly are they going to pressure to end an open-source project involving millions of globally spread mostly unidentifiable developers, miners and users?

This distinction – between one project with a single, identifiable authority figure and another whose governance is distributed and leaderless with a founder who has never revealed their identity – goes to the heart of a crypto community critique that the social media giant’s initiative is not censorship resistant.

When there’s someone in charge, an interested party – a policymaker, a banker, a regulator, a shareholder – can lean on them to make changes. And when the blockchain consensus model is based on a club-like permissioned membership, a coordinated effort to alter, or censor, the ledger is always possible. And if the ledger or its software can be altered by this pressure, the Libra platform can’t unconditionally promise to support open, unfettered access for users and a permissionless innovation environment for developers.

Let’s be clear: Libra’s designers have thought deeply about how to protect their project from Facebook itself, both in a real sense and that of public perception. In its commitment to decentralization, the team has put the code under an open-source license, handed the network’s governance authority to a separate Swiss-based foundation, brought in 27 external partners to work alongside Facebook as independent, permissioned nodes in the network, and verbally committed to transition to a permissionless model over time. There is a structure and roadmap in place for Libra to grow and survive regardless of its genesis as a Facebook project.

All that’s fine. But we’re still at the genesis phase, one that is and will for some time hinge on the centrality of a particularly powerful company.

The culture problem

At the risk of stating the obvious, Marcus and his team are paid by Facebook. Follow the money, as they say. But also, follow the code.

The Libra protocol’s all-important source code is now open-sourced, but it was conceived and gestated inside Facebook. So, whether the project managers and programmers resist or not, the culture of that organization will inherently feed into Libra’s design priorities.

The elephant in the room is that a drumbeat of recent news has revealed Facebook’s corporate culture to be profoundly toxic. The company’s model of surveillance capitalism has turned users into pawns in a global game of data manipulation, cultivated echo chambers of narrow-mindedness, done irreparable harm to the worthy cause of journalism, and deeply undermined our democracy.

This legacy is the unavoidable reason why people, including lawmakers, are alarmed that Facebook might be on the verge of creating a new international model for money and payments. Rightly or wrongly, there’s a fox-in-the-henhouse optic here that’s unhelpful.

Wharton Professor Kevin Werbach argued in the New York Times this week that Facebook’s Libra is a bold effort to win back public trust by leveraging the accountability ingrained in blockchain technology. But at the project’s genesis phase, with no choice but to trust Facebook’s early input, that legacy of prior mistrust could easily become a huge barrier to its progress.

We should support Libra, not Facebook

Notwithstanding all the above, I actually want Libra to succeed. (Note: I also want Facebook to die. That’s not a contradiction; those two outcomes can and should be separate. In fact, it’s the nub of the issue.)  

The Libra team has set its sights on achieving financial inclusion for the 2 billion adults worldwide who don’t have bank accounts. It’s a noble goal, and they are going about in an intelligent way – from a truly international, cross-border, cross-currency perspective. Bring all those people into the international economy and the payoffs could be huge, for them and for the rest of us.

And let’s face it, bitcoin has dismally failed to live up to its advocates’ promises of a financial inclusion solution. Bitcoin’s and other cryptocurrencies’ impact on the $800 billion global remittances market is puny.

Sure, uptake could rise if the off-chain Lightning Network lives up to its promise to enable larger-scale transaction-processing, if stablecoin projects resolve bitcoin’s volatility problem, and if new encryption solutions can improve both security and user experience with crypto wallets. But these solutions will take time. We need to act now.

In the end, it’s not at all clear that global person-to-person payments are a viable use case for bitcoin, perhaps because too many HODLing speculators crowd all the spenders out. And, of course, no other payments-focused cryptocurrency has put a big enough dent in the remittance market.

So, perhaps the recipe for a global broadening in payments lies with a cross-border, low-volatility international stablecoin backed by a basket of leading fiat currencies and developed with the formidable programming and marketing resources of 28 tech and financial giants. Also, when you combine Facebook’s, Instagram’s and WhatsApp’s user count, the number of potential wallets runs to 4 billion. Global network effects. Instantly.

All other things being equal – that is, if we ignore, for now, the genesis problem of Libra inheriting Facebook’s toxic roots – one could also argue that a permissioned, corporate network is the best approach for the Libra blockchain in place of a fully open, permissionless chain such as bitcoin’s or ethereum’s. The heavy lifting needed for early global traction  – the software development, the marketing effort and the public policy outreach – requires that significant corporate resources be deployed in a targeted, coordinated manner that’s hard for open-source blockchain communities to achieve. There are efficiency advantages to be had from centralization.

Over time, as the project grows, Libra hopes to expand the consortium. That could undermine the coordination efficiency, but in a classic centralization-versus-decentralization tradeoff, the addition of new members – more NGOs, some banks, a workers union perhaps, and some public pension funds – will achieve greater diversity and lower collusion capacity. It’s far from perfect but the timed transition brings things closer to censorship resistance at a time in the future when it will matter — if it they get there.

What this means for bitcoin and crypto

As an aside, I also believe Libra’s success would be a positive for bitcoin – and the past week’s price action suggests that the market sees the same.

Here’s why: Currently the one value proposition that holds well for bitcoin is that it will be a more liquid, digitally up-to-date risk-hedging vehicle than gold when people need to preserve value in something immune from political and institutional risk. That argument could be enhanced if Libra succeeds in converting billions of people to digital payment wallets, because it will more broadly establish the power of blockchain-based digital money as the way of the future. At the same time, because of its genesis as a Facebook-initiated, permissioned system, Libra will not shake the perception of being prone to political – i.e. censorship – risks. For many, then, Bitcoin, aka digital gold, will become the obvious alternative.

The currency-basket-backed Libra token is, however, a real competitor to other reserve-backed crypto-tokens, such as USDC, issued by the CENTER coalition initially formed by Circle and Coinbase, GUSD, Gemini’s stablecoin, and PAX, from Paxos.

But we can imagine events working in the latter’s favor. Developing countries like India, for example, may become hostile to a new currency entering circulation that sucks demand away from their local currencies, but they would be more accepting of a digital dollar, given that the greenback already circulates in their economies. Users, also, might be happier holding tokens pegged to single sovereign currencies rather than in a hard-to-measure basket. And if concerns about centralized control undermines trust in Libra or limits innovation, the fact that these tokens are built on truly permissionless blockchains may make them more appealing (even if you still have to trust the reserve-holder to guarantee to the price stability.)

Whatever happens, the world of money flows is mind-blowingly huge. There are $6 trillion a day in foreign exchange transactions alone. That allows plenty of room for different models, different tastes, and different trust systems for coordinating digital value exchange.

Getting our priorities straight

The bigger risk is not that Libra succeeds and enriches Mark Zuckerberg even more but that neither Libra nor one of its crypto competitors ever succeeds in breaking down the barriers to economic participation. Financial exclusion breeds poverty, which in turn breeds terrorism and war.

And if we assume that the technology, if it isn’t yet ready, will ultimately get there, then the biggest threat to that is from a policy mistake.

The subtext of both Waters’ statements and those of European lawmakers was that this private exchange system can’t be allowed to replace national currencies. Thats’ not what Libra intends, but the perception that it is undermining nation states’ sovereignty over money could stoke fears and lead to a ban on Libra. And if that happens, it sets an ugly precedent for or all other competing ideas, whether it’s USDC, GUSD, PAX or DAI or something else.

The projects capacity to foster financial inclusion could also be hurt by the Financial Action Task Force’s, or FATF,  embrace of a new rule for exchanging cryptocurrency.  If ratified by enough countries that could curtail the free flow of cryptocurrency among addresses that haven’t been through a bank-like “know your customer” process. In other words, it could pose a real barrier to Libra’s and everyone else’s dream of financial inclusion for the “unbanked.”

The bottom line: the Libra team has its work cut out, and we all have a lot riding on it. The project’s representatives must face the reality that, for now at least, the buck still stops with Zuck, and that regulators will use that against them.

We should all wish them success in trying to convince policymakers that an open-system to global financial transactions is important. (It’s encouraging that the Bank of England is taking an open-minded view, proposing that tech companies like Libra be allowed to access funds directly from central banks.)

But, by the same token, we must be vigilant against corporate power that could easily convert this important project into something more sinister. Facebook’s own history is a reminder of the risks we face.

I wish it were a different company running with this ball right now. But since it’s not, the need for all of us to take a direct interest in this project is even greater.

We must demand that our representatives provide clear-headed, informed oversight that holds corporations like this to account and curtails their monopolizing powers. But we should also expect smart, open-minded regulation that encourages companies to compete and innovate in an open system that creates opportunities for everyone on this planet.

32. 24/06/2019 08:37
Bitcoin Tests $11.3K With Fresh 2019 Highs

Bitcoin has broken yet another 2019 record, reaching as high as $11,304, before conceding a short-term period of profit taking.

At 21:00 UTC on June 23, the world’s largest cryptocurrency by market capitalization shot upwards on the daily chart, cementing a new high beyond June 22’s peak of $11,215.

The move to another 2019 high comes after bitcoin’s price dropped to as low as $10,416 on June 23 before another surge of buying pressure pushed prices back above $10,750 within the same day.

From then BTC bolstered 6 percent, rising above $11,000 at around 19:00 UTC on Sunday evening and then reaching over $11,300 two hours later. It’s currently changing hands at $10,768 as per CoinDesk’s price data.

BTC’s 2019 bull run has already started off with a bang in recent weeks, a likely a combination of traders buying into their own fear-of-missing-out (FOMO) as well as institutions chasing the tail end announcement of Facebook’s project Libra.

However, large levels of volume failed to accompany the rally, beginning at 97.6 billion traded over a 24-hour period and continued to decrease to as low as 67.5 billion by days end, meaning that the move was unsupported and a small sell-off from that point out, was definite.

Its “Real 10” volume – a metric that takes into account trading volume from exchanges reporting honest volume figures as identified in a report by Bitwise Asset Management – currently stands at $46.17 billion, a large difference, according to Messari.io.

Meanwhile, the rest of the market remains relatively flat today, with but a few in the top 20 posting gains. Cadano (ADA) and UNUS SED LEO (LEO) are the only two in the green within the top 20 at CoinMarketCap and are both posting 0.4-2.4 percent growth, respectively, over a 24-hour period.

In addition, the total market capitalization rose to a high of $331.8 billion, its highest point since July 31, 2018, while the market capitalization for altcoins is down $3.8 billion over a 24-hour period pointing to a preference in holding BTC above all else amongst the trading elite.

33. 22/06/2019 09:47
Bitcoin Price Eyes $10K After Erasing 40% of Bear Market Drop
  • Bitcoin’s price has recovered 40 percent of the bear market drop. The breakout has bolstered the bullish setup on the weekly chart, which is currently reporting the strongest buying pressure in six months. As a result, BTC looks set to break above the psychological resistance of $10,000.
  • The price has already rallied nearly 130 percent so far this quarter. Hence, a temporary correction due to bull exhaustion cannot be ruled out.
  • The outlook, however, will remain bullish as long the price is held above recent lows near $7,500.

Bitcoin’s (BTC) price has erased 40 percent of the sell-off seen in the twelve months to December 2018 and looks set to rise above $10,000.

The leading cryptocurrency by market value rose above $9,740 on Bitstamp earlier today, retracing more than 40 percent of the drop from the record high of $19,666 reached in December 2017 to the low of $3,122 hit in December 2018. The global average price, as calculated by CoinMarketCap, is just $150 away from achieving that milestone.

As of writing, BTC is changing hands at $9,840 on Bitstamp – the highest level since May 2018 – representing 31 percent gains from lows near $7,500 seen on June 10.

It is worth noting that bitcoin’s latest leg higher is a accompanied by a rally in gold prices. The yellow metal has risen from 1,320 to $1,411 over the last ten days.

The positive correlation between the two assets contradicts the divergent price action seen in the preceding seven months.

For instance, BTC fell from $6,200 to levels near $3,100 in four weeks to December 14, 2018. During the same time period, gold went from $1,200 to $1,300 and further extended the rally to $1,346 (Feb. 20 high). By early May, the yellow metal was down 6 percent from February highs, while bitcoin was up 76 percent from December lows.

The change from negative correlation to positive correlation, if sustained, could boost bitcoin’s appeal as digital gold. Many including the likes of Tyler Winklevoss, founder of Winklevoss Capital Management, already consider bitcoin as gold 2.0.

It remains to be seen if the two assets continue to move in the same direction in the near future. That said, technical charts indicate bitcoin is likely to extend its ongoing bullish run to levels above $10,000.

Weekly chart

Bitcoin’s convincing move above the widely tracked 38.2 percent Fibonacci retracement hurdle of $9,442 has strengthened the bullish case put forward by the higher lows, higher highs pattern, ascending 5- and 10- week moving averages and Chaikin money flow index, which is currently reporting strongest buying pressure in six months with a reading of 0.35.

As a result, the cryptocurrency looks set to test the next major resistance range marked by the April 2018 high of $9,949 and the psychological resistance of $10,000.

A high-volume weekly close above $10,000 would expose the 50 percent Fibonacci retracement resistance of $11,394.

It is worth noting that the cryptocurrency is up nearly 140 percent on a quarter-to-date basis (from April 1’s opening price). The bulls usually take a breather following such stellar rallies.

So, a sudden correction cannot be ruled out. That said, the outlook would turn bearish only if the price violates the bullish higher lows pattern with a move below $7,500.

34. 21/06/2019 10:12
Craig Wright Offers New Details on Bitcoin Trust at Heart of Billion-Dollar Lawsuit

New details have emerged in the ongoing lawsuit in the U.S. filed last year against Craig S. Wright, the technologist who claims to be the pseudonymous creator of bitcoin, Satoshi Nakamoto.

A redacted declaration filing from Kleiman v. Wright surfaced today, which details Wright’s purported ownership and the trustee scheme of the Tulip Trust, which supposedly holds over one million bitcoin. According to the filing, access to the holdings of the trust requires participation of all trustees, at least one of whom he hasn’t been in contact for several years.

The court document was originally filed on May 8, and also points to the existence of a second Tulip Trust, known as Tulip Trust II. 

Days before the document was filed, a federal court ordered Wright to disclose his bitcoin addresses in the ongoing lawsuit. Wright is being sued by Ira Kleiman on behalf of the estate of his brother, the late Dave Kleiman. The nChain chief scientist is accused of scheming to “seize Dave’s bitcoins and his rights to certain intellectual property associated with the bitcoin technology.”

Kleiman is seeking half of the 1.1 million bitcoins the two are said to have mined together, or its “fair market value,” as well as compensation for infringement of intellectual property. The initial complaint did not seek to ascertain whether Wright is the person behind the Nakamoto identity, stating that “it is unclear whether Craig, Dave and/or both created Bitcoin.”

According to the declaration released Thursday, the Tulip Trust consolidated the bitcoin Wright mined and purchased between 2009 and 2011. 

The trust first came to public attention through a leaked document on December 9, 2015. Allegedly written in 2011 by Dave Kleiman, a forensic computer investigator and author, the document describes a trust fund containing exactly 1,100,111 bitcoin, “to be managed by at least three people but not more than seven at any time.” The document also declares the bitcoin holding is to be returned to Craig Wright on January 1, 2020.

These new developments come amid an ongoing mediation process, which as of June 18 has yielded no results — in the words of the mediator, as reported by attorney Stephen Palley, “we are at an impasse.”

As it stands, Wright is due for deposition in Florida on June 28.

Trust details

According to Wright’s court declaration, seven trustees were named, including Craig Wright, David Kleiman, and Ms. Uyen Nguyen — whom Wright claimed he has had no contact with since 2016. That said, Kleiman was the initial, and sole, trustee before others were appointed.

Panopticrypt Pty Ltd, an Australian entity now in liquidation was also named alongside an unnamed Seychelles entity and CO1N Ltd., a U.K. entity liquidated in 2017.

“The contacts at CO1N were Dave Kleiman and Ms Nguyen, who was terminated as director on June 1, 2016. Presently, there is no one other than myself who was a contact for this entity.” Nguyen was allegedly terminated as director of CO1N in June 2016.

The final trustee listed is “the holder of PGP key IDs, which is Satoshi Nakamoto,” with Craig Wright parenthetically related.

In the past, Wright has said that the trust is encrypted using a a method called Shamir’s Secret Sharing Algorithm. The only way to access them, he’s said, is to accrue the collective private keys in order to decrypt it.

Wright complied with the directive pursuant to a court order to produce bitcoin holdings for all bitcoin Wright mined prior to December 31, 2013. The filings were subsequently sealed. 

The Tulip Trust II was settled in 2014 in Seychelles with Equator Consultants listed as a trustee. Wright and his wife Ramona Watts are the primary beneficiaries. The holdings of this second trust are unknown.

Wright also hinted at an inaccessible trove of bitcoin mined between 2011 and 2013 by staff at HighSecured and Signia Enterprises under his direction, to be held on behalf of the original Tulip Trust. Wright alleges the principles of HighSecured were arrested in 2015.

Wright has claimed in the past the Tulip Trust is currently inaccessible. In the court document Wright said:

“Access to the encrypted file that contains the public addresses and their associated private keys to the Bitcoin that I mined, requires myself and combination of trustees reference in Tulip Trust I to unlock based on Shamir scheme.”

Dave Kleiman passed away in 2013. Last December, the court denied Wright’s attempt to dismiss the lawsuit, saying that he “converted at least 300,000 bitcoins upon Dave’s death and transferred them to various international trusts.”

35. 20/06/2019 10:05
Will Facebook’s Libra Be an On-Ramp or Dead End for Crypto?

Facebook’s announcement that it would create a stablecoin on a blockchain means more as a competitive answer to WeChat and Alipay’s payment services than it does to the crypto industry, according to AngelList co-founder Naval Ravikant.

Ravikant told CoinDesk via email:

“I don’t think it means much for crypto because it’s not really (sovereign-resistant) crypto.”

The immediate question for the crypto industry following the announcement of Facebook’s ambitious Libra project was whether this new token will lead more users into the broader world of cryptocurrency or insulate them from other projects. That is, will someone who becomes a Libra user be more likely to one day hold bitcoin, ether, EOS or other crypto assets?

For his part, Ravikant sees a way Libra could meet a need, noting that it could lower the cost of global payments, but, he added, “I struggle to see why it needs to be on a blockchain other than for PR / Marketing.”

The Asian consumer payments giants Tencent (parent of WeChat) and Alibaba (parent of Alipay) seem to agree: They say they won’t be following Facebook’s lead into cryptocurrency development.

That said, most of the industry sounds upbeat following the news that the fifth largest company in the world by market capitalization, Facebook, is leading a slew of financial giants (such as Visa, PayPal and Stripe) into the blockchain universe.

For example, Fred Wilson, a partner at Union Square Ventures, one of the founding members of the Libra Association, wrote on his blog:

“So as we think about the potential drivers for mainstream crypto adoption, a simple, fully-collateralized, cryptocurrency used inside the world’s largest applications, touching hundreds of millions or billions of consumers, is perhaps the most promising one.”

In fact, others pointed to specific mechanisms by which individuals might find their way into crypto in a world where Libra becomes a common way of transacting value.

“It’s good news for exchanges and good news for crypto because you’ll have a lot more vetted users,” Avivah Litan, an analyst at Gartner, told CoinDesk. She foresaw exchanges as being a major source for attaining Libra in the early days. “So now when you’re signing up for Libra you’re going to see more cryptos as well.”

People who already have access to financial services will be motivated to find ways to get crypto in order to get better deals, Kyle Samani of Multicoin Capital told CoinDesk.

“The value prop is clear: discounts through merchant partners like Uber and Lyft and Spotify (and many more to be announced),” Samani told CoinDesk via email. For the unbanked, it’s the chance to use a currency that’s potentially more stable than their country’s national currency.

Preston Byrne, an attorney at Byrne & Storm and an early entrepreneur in the world of permissioned blockchains, told CoinDesk he foresees Libra being helpful at a high level so long as the network is not built in a walled-off way.

“As long as it requires people who are hooking into the ecosystem to use things that are otherwise good for cryptocurrency, then it’s good for cryptocurrency,” Byrne said.

Joey Krug, Augur’s creator and an investment officer at Pantera Capital – one of the industry’s largest crypto investors – pointed to one way the infrastructure has already committed to play nice with the rest of the industry.

“Libra has stated the underlying network will have pseudonymous addresses just like any other crypto network, which means exchanges can list Libra, effectively making it an on-ramp to all of crypto,” Krug told CoinDesk.

Byrne did note that Facebook and its partners could use their clout to crowd out other cryptocurrencies, if they wanted to. For her part, Arianna Simpson, founder of Autonomous Partners and a former Facebook employee, does not see an existential threat to bitcoin in Libra.

“Other cryptocurrencies – Stellar and Ripple come to mind – are much more likely to have their raison d’être called into question,” she wrote in a note to her limited partners, which was shared with CoinDesk.

In fact, on bitcoin, Samani offered another tantalizing bit of speculation. He argued that with interest rates on sovereign bonds moving so widely into negative territory, the Libra reserve is going to have a hard time finding extremely conservative investments with an upside.

Samani said:

“I would expect the Libra Association to maintain some of its reserves in permissionless cryptocurrencies like BTC. So that’s one path, though it’s not confirmed.”

Big does not always win

If Facebook is able to convince the world that crypto works, Libra itself will have to work. And that’s no sure thing.

Industry insiders were quick to recall the many headline-grabbing tech products that never caught on.

That said, the general response seems to be excitement about Facebook and its partners potentially educating billions of people about public-private keys, payments without intermediaries and money on the internet.

But there were a lot of notes of caution, particularly about whether or not Facebook could really lead users to use its new blockchain.

Joel Monegro of Placeholder, a prominent New York City-based venture fund, compared it to the earliest iterations of the Microsoft Network, which was basically Microsoft’s attempt to create its own proprietary internet.

Monegro told CoinDesk via email:

“Libra is to Facebook what MSN was to Microsoft. They sense the opportunity, but are missing the point.”

Similarly, CoinFund founder Jake Brukhman rattled off a list of major failures by other tech giants. Though generally optimistic about Libra’s potential to benefit the whole market, Brukhman cautioned that “people also tend to get excited and underestimate how hard it is to launch successful products even as established exceptional companies.”

For example, he mentioned Amazon’s Fire Phone. Additionally, Google has had a cascade of failed creations. In social media alone, it failed with Orkut, Buzz, Wave and Google Plus. Apple’s self-driving car product was stillborn.

But Albert Wenger, also of Union Square Ventures, wrote on his blog about how critical a wide distribution network has been at key moments of technological expansion. He too drew an example from Microsoft: the introduction of Internet Explorer (IE) to all Windows users in 1995.

IE drove tremendous adoption of the internet. But, as Wenger wrote, “It is useful to remember that Microsoft was not the primary beneficiary of the web.”

But is it my giant?

The 53 co-authors of “The Libra Blockchain” white paper said the blockchain was built to offer “a new global currency — the Libra coin.” Currencies are money’s consumer application, but will be Libra be consumer-friendly?

William Quigley was a co-founder of the company that created tether, the original stablecoin, and he’s now the CEO of WAX, a startup organized around digital property rights. He thinks Libra will save people money on almost everything they buy.

“It’s probably 1.5 percent of global GDP is just eaten up in currency conversions,” Quigley estimated. “I think that’s a big part of what Facebook is looking at.”

Others aren’t betting against the world’s entrenched financial institutions, however.

As Tyler Cowen, one of the globe’s most influential economists, wrote on his blog: “Have banks ever lost a political battle of this kind?”

If any coalition could uproot those channels, it may be the group of extremely powerful companies Facebook has assembled. But that sheer size could pose another danger to the masses.

“It comes with the risks of centralized pain points and vulnerabilities,” ConsenSys founder Joseph Lubin told CoinDesk. “Data silos enable incumbents to maintain pricing power, and also come with the risks of data breaches, privacy, and security issues – problems that many have already begun to associate with Facebook.”

Maya Zehavi, a blockchain consultant and entrepreneur, offered similar concerns. While Facebook theoretically won’t control the Libra blockchain, earlier iterations of the company have been known to wreak havoc on startups that build businesses dependent on Facebook platforms. Just ask Zynga.

At this very early date, Zehavi said Libra looks like a “closed loop.”

“If you want to make an investment or if you want to run a product today, you need to be able to run a node, a full node,” she said. “You need to have the infrastructure in place to be a part of that network.” Plus, there’s the cost.

Founding members of the Libra Association have paid $10 million each for the privilege of running a node, though there are plans to ultimately open node membership to anyone. (Founding members also get a return on their investment in the form of interest generated by the Libra reserve’s potentially vast pool of coin-backing assets.)

Still, Quigley, the tether creator, thinks the 10 years of crypto history to date should be the main framework for evaluating Facebook’s Tuesday announcement. Several people CoinDesk spoke to made some version of his same point:

“Every time a new cryptocurrency has been created it has been additive to the overall crypto experience.”