Could Libra turn Facebook into WeChat's main rival?

Could Libra turn Facebook into WeChat's main rival? - pounds facebook cryptocurrencyIn political discussions it is very popular to be skeptical about Libra, and it is not difficult to imagine why. Facebook has taken insidious political positions in recent years, later finding itself crushed by a series of crises in public relations that suggest an antithetical version of King Midas' touch.

As a result, economists around the world have responded to the Facebook currency idea exactly as one might expect, and it is impossible to ignore the panic that Libra's announcement is unleashing.

But criticizing is simple, building is difficult, and it is worth taking into account the impact that Libra could have if making a wider-ranging hypothesis. What would this new currency mean for consumers, global markets and the universe of cryptocurrencies?

The Chinese situation

In China most of the retail business works through WeChat, which has gone from being a simple messaging application to a platform to do just about anything.

In almost all the rest of the world there is still no service of this type, complete and perfectly integrated into society, which is enormously convenient for the platform, but also positively impacting on the lives of consumers: convenience, range and access to available services are unmatched.

Obviously, large numbers are needed to start such an operation, and Facebook has these too, and has already used them on other occasions to launch new products.

Integration is the way forward

Integrating Libra initially in Messenger and WhatsApp services (and possibly also Instagram) means addressing billions of people right away. Imagine being able to exchange money in an extremely simple and fast way between relatives and friends, regardless of the national borders that separate you, and being able to order a dinner, pay a taxi or ask for a small economic loan all from the same application.

If the goal is to convince consumers to spend money through the platform, we can predict that a myriad of new low-cost services for users will be born, which will make the use of Facebook as a multifunctional platform an attractive if not indispensable experience.

Could Libra put Bitcoin into crisis?

It is unlikely! Bitcoin is transforming its initial project of being the new payment network into that of becoming the new "digital gold" with which it is managing to conquer its niche of medium and large investors.

Other cryptocurrency fledglings like Litecoin or Ripple are likely to suffer, and more than anyone else will be traditional payment services such as Western Union, Moneygram and in many cases even banks, to pay the price for this evolution.

If, as expected, Libra aims to offer services similar to those of its main competitors but at a fraction of the current price, it is not difficult to imagine what a turn this sector will take in the immediate future.