Joseph Lubin Has His Doubts About How Decentralized Libra Will Be

By Rushali Shome

Ethereum co-founder and ConsenSys founder Joseph Lubin has recently published a blog post discussing the much anticipated Libra cryptocurrency. Talking about the native crypto project spearheaded by social media giant Facebook, he has said that it is akin to a “centralized wolf in a decentralized sheep’s clothing”.

Indeed, concerns about Facebook’s tendency of over-centralozation is nothing new in the discourse about Libra and Lubin builds on the same basic question, even as he acknowledges the advantages of embracing Libra.

He has noted that Libra will definitely help the people to exchange money speedily and cheaply, but Facebook might face repercussions of the lack of trust that exists between the company and its users.

He incisively comments on how the Libra white paper has been put together, writing:

“Facebook is painfully aware of the gulf of trust between itself and the public. And that’s likely why Facebook itself is hardly mentioned anywhere in the whitepaper or technical documentation.”

Moreover, he points out that the Libra white paper does not suggest a possibility of the company eliminating the element of “subjective trust” that is usually a basic function of most blockchain networks. Instead, users will be required to implicitly trust Facebook itself.

He comments on the nature of trust itself, and writes:

“Trust is a slippery subject, especially when magnified to the scale of a global financial infrastructure. Ten years ago, the bitcoin whitepaper proposed that instead of relying “exclusively on financial institutions serving as trusted third parties to process electronic payments,” we can instead rely on cryptoeconomic proof. With an internet connection, anyone can participate in the peer-to-peer network and inspect the ledger. Social consensus can protect against a cabal seeking to reverse or censor transactions.”

Lubin’s commentary on trust is a poignant one, highlighting how the issues with Facebook’s centralising tendencies might spill over to its crypto aspirations. Clearly, a lot is left to be seen with regard to Project Libra, but as of now, it seems unlikely that it will be a true blue decentralized asset.

Rushali Shome

Rushali Shome is a history undergraduate with a keen interest in puns, politics and beyond. When not typing away furiously in the “Notes” section of her phone, she can be found trying to catch the eye of servers at restaurants or weddings for a second helping.

Related Posts