Christian Catalini, co-creator of Libra and chief economist at Calibra, explains why Facebook made the design choices it made for Libra, reveals whether the team was prepared for the regulatory blowback it received after publishing the white paper, and talks about what it means for Libra now that nearly all the initial payment company members have left the Association. He describes how Facebook defined stability for Libra, whether the Chinese renminbi could ever be added to the reserve the way it is part of the IMF special drawing rights basket, and if so, what the Libra or Calibra would do if the Chinese government tried to censor individuals or transactions in the system. We also cover the tension between the desire to have strong know-your-customer and anti-money laundering processes on the platform but then also to bank the unbanked, who often don't have strong government identification. We also discuss how Facebook will make money from Calibra, what it would take for Facebook to let the Libra Association go forward without it, and why Facebook, which not too long ago was trying to woo China to enter the Chinese market, now says it is the best counterweight to a Chinese digital yuan. Plus, he answers how Facebook and Calibra will handle privacy.
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Episode links:
Christian Catalini: https://twitter.com/ccatalini
Libra: https://libra.org/en-US/
Calibra: https://calibra.com/
Libra white paper: https://libra.org/en-US/wp-content/uploads/sites/23/2019/06/LibraWhitePaper_en_US.pdf
Letters to payment companies from Congress: https://www.schatz.senate.gov/imo/media/doc/Signed%20Letters%20re%20Libra%20to%20Patrick%20Collison,%20Ajaypal%20Banga,%20and%20Alfred%20Kelly.pdf
Mark Zuckerberg's testimony in front of Congress: https://www.c-span.org/video/?465293-1/facebook-ceo-testimony-house-financial-services-committee
Reported breakdown of the Libra reserve: https://www.reuters.com/article/us-facebook-libra-basket/u-s-dollar-to-be-main-currency-underpinning-facebooks-libra-spiegel-idUSKBN1W522K
Calibra — can send money at low to no cost: https://newsroom.fb.com/news/2019/06/coming-in-2020-calibra/
Chargebacks in Libra: https://www.theverge.com/2019/6/18/18682838/facebook-digital-wallet-calibra-libra-cryptocurrency-kevin-weil-david-marcus-interview
Asian central banks not too open to Libra: https://www.bloomberg.com/opinion/articles/2019-10-22/facebook-scaling-back-libra-will-please-asian-central-banks
Unconfirmed interview about UN work with blockchain-based vouchers: https://unchainedpodcast.com/the-un-world-food-programmes-blockchain-based-food-vouchers-for-syrian-refugees-with-robert-opp/
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