In 2020, Facebook (FB) is set to launch another digital coin to compete against the premier Bitcoin amongst others. Although it is a highly exciting currency, it is not without questions over several security concerns.
Primarily, Facebook Libra is a private cryptocurrency – an ownership status that attracts significant security questions. For this reason, the coin might not access the Indian market as the authorities have vowed to fight the trading of Libra in India. On an interview with Bloomberg, India’s Secretary for Economic Affairs, Subhash Garg announced “Design of the Facebook currency has not been fully explained” and “Whatever it is, it would be a private cryptocurrency, and that’s not something we have been comfortable with.”
Entrusting Facebook, a company with a strained history of data security, with financial data, is something that most people won’t vouch for. The US and European politicians have this concern as the basis for their pushback against Libra. According to the US House Financial Services committee chair, Rep. Maxine Waters, Facebook “has repeatedly shown a disregard” to data security and Libra should not be launched before the redress of all these issues.
Hacking is also a real threat to Libra because its developer platform is a massive vector of abuse. In the spirit of innovation, this window opens a door for malicious developers to access Libra through Libra apps.
Briefly, the blockchain cannot exist without security concerns, but effective management of all emergent concerns can influence the success of the corporate-backed Libra.