{"id":15390,"date":"2019-06-19T02:04:10","date_gmt":"2019-06-19T02:04:10","guid":{"rendered":"https:\/\/rsoftsolution.com\/blog\/the-real-risk-of-facebooks-libra-coin-is-crooked-developers.html"},"modified":"2019-06-19T02:04:10","modified_gmt":"2019-06-19T02:04:10","slug":"the-real-risk-of-facebooks-libra-coin-is-crooked-developers","status":"publish","type":"post","link":"https:\/\/www.rbsitsoftwaresolution.in\/blog\/the-real-risk-of-facebooks-libra-coin-is-crooked-developers.html","title":{"rendered":"The real risk of Facebook\u2019s Libra coin is crooked developers"},"content":{"rendered":"

Everyone\u2019s worried about<\/span> Mark Zuckerberg controlling the next currency, but I\u2019m more concerned about a crypto Cambridge Analytica.<\/p>\n

Today Facebook announced Libra, its forthcoming stablecoin<\/a><\/span> designed to let you shop and send money overseas with almost zero transaction fees. Immediately, critics started harping about the dangers of centralizing control of tomorrow\u2019s money in the hands of a company with a poor track record of privacy and security.<\/span><\/p>\n

Facebook anticipated this, though, and created a subsidiary called Calibra to run its crypto dealings and keep all transaction data separate from your social data. Facebook shares control of Libra with 27 other Libra Association founding members, and as many as 100 total when the token launches in the first half of 2020. Each member gets just one vote on the Libra council, so Facebook can\u2019t hijack the token\u2019s governance even though it invented it.<\/span><\/p>\n

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With privacy fears and centralized control issues at least somewhat addressed, there\u2019s always the issue of security. Facebook naturally has a huge target on its back for hackers. Not just because Libra could hold so much value to steal, but because plenty of trolls would get off on screwing up Facebook\u2019s currency. That\u2019s why Facebook open-sourced the Libra Blockchain and is offering a prototype in a pre-launch testnet. This developer beta plus a bug bounty program run in partnership with HackerOne is meant to surface all the flaws and vulnerabilities before Libra goes live with real money connected.<\/span><\/p>\n

Yet that leaves one giant vector for abuse of Libra: the developer platform.<\/span><\/p>\n

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Facebook announces Libra cryptocurrency: All you need to know<\/a><\/p>\n<\/blockquote>\n

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\u201cEssential to the spirit of Libra . . . the Libra Blockchain will be open to everyone: any consumer, developer, or business can use the Libra network, build products on top of it, and add value through their services. Open access ensures low barriers to entry and innovation and encourages healthy competition that benefits consumers,\u201d Facebook explained in its white paper and Libra launch documents. It\u2019s even building a whole coding language called Move for making Libra apps.<\/span><\/p>\n

Apparently Facebook has already forgotten how allowing anyone to build on the Facebook app platform and its low barriers to \u201cinnovation\u201d are exactly what opened the door for Cambridge Analytica to hijack 87 million people\u2019s personal data and use it for political ad targeting.<\/span><\/p>\n

But in this case, it won\u2019t be users\u2019 interests and birthdays that get grabbed. It could be hundreds or thousands of dollars\u2019 worth of Libra currency that\u2019s stolen. A shady developer could build a wallet that just cleans out a user\u2019s account or funnels their coins to the wrong recipient, mines their purchase history for marketing data or uses them to launder money. Digital risks become a lot less abstract when real-world assets are at stake.<\/span><\/p>\n

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In the wake of the Cambridge Analytica scandal, Facebook raced to lock down its app platform, restrict APIs, more heavily vet new developers and audit ones that look shady. So you\u2019d imagine the Libra Association would be planning to thoroughly scrutinize any developer trying to build a Libra wallet, exchange or other related app, right? \u201cThere are no plans for the Libra Association to take a role in actively vetting [developers],\u201d Calibra\u2019s head of product Kevin Weil surprisingly told me. \u201cThe minute that you start limiting it is the minute you start walking back to the system you have today with a closed ecosystem and a smaller number of competitors, and you start to see fees rise.\u201d<\/span><\/p>\n

That translates to \u201cthe minute we start responsibly verifying Libra app developers, things start to get expensive, complicated or agitating to cryptocurrency purists. That might hurt growth and adoption.\u201d You know what will hurt growth of Libra a lot worse? A sob story about some migrant family or a small business getting all their Libra stolen. And that blame is going to land squarely on Facebook, not some amorphous Libra Association.<\/span><\/p>\n

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Image via Getty Images \/ alashi<\/p>\n

Inevitably, some unsavvy users won\u2019t understand the difference between Facebook\u2019s own wallet app Calibra and any other app built for the currency. \u201cLibra is Facebook\u2019s cryptocurrency. They wouldn\u2019t let me get robbed,\u201d some will surely say. And on Calibra they\u2019d be right. It\u2019s a custodial wallet that will refund you if your Libra are stolen and it offers 24\/7 customer support via chat to help you regain access to your account.<\/span><\/p>\n

Yet the Libra Blockchain itself is irreversible. Outside of custodial wallets like Calibra, there\u2019s no getting your stolen or mis-sent money back. There\u2019s likely no customer support. And there are plenty of crooked crypto developers happy to prey on the inexperienced. Indeed, $1.7 billion in cryptocurrency was stolen last year alone, according to CypherTrace via CNBC<\/span><\/a>. \u201cAs with anything, there\u2019s fraud and there are scams in the existing financial ecosystem today . . .\u00a0 that\u2019s going to be true of Libra too. There\u2019s nothing special or magical that prevents that,\u201d says Weil, who concluded \u201cI think those pros massively outweigh the cons.\u201d<\/span><\/p>\n

Until now, the blockchain world was mostly inhabited by technologists, except for when skyrocketing values convinced average citizens to invest in Bitcoin just before prices crashed. Now Facebook wants to bring its family of apps\u2019 2.7 billion users into the world of cryptocurrency. That\u2019s deeply worrisome.<\/span><\/p>\n

\"\"<\/p>\n

Facebook founder and CEO Mark Zuckerberg arrives to testify during a Senate Commerce, Science and Transportation Committee and Senate Judiciary Committee joint hearing about Facebook <\/a> on Capitol Hill in Washington, DC, April 10, 2018. (Photo: SAUL LOEB\/AFP\/Getty Images)<\/p>\n

Regulators are already bristling, but perhaps for the wrong reasons. Democrat Senator Sherrod Brown tweeted<\/span><\/a> that \u201cWe cannot allow Facebook to run a risky new cryptocurrency out of a Swiss bank account without oversight.\u201d And French Finance Minister Bruno Le Maire told<\/span><\/a> Europe 1 radio that Libra can\u2019t be allowed to \u201cbecome a sovereign currency.\u201d<\/span><\/p>\n

Most harshly, Rep. Maxine Waters issued a statement saying, \u201cGiven the company\u2019s troubled past, I am requesting that Facebook agree to a moratorium on any movement forward on developing a cryptocurrency until Congress and regulators have the opportunity to examine these issues and take action.\u201d<\/span><\/p>\n

Yet Facebook has just one vote in controlling the currency, and the Libra Association preempted these criticisms, writing, \u201cWe welcome public inquiry and accountability. We are committed to a dialogue with regulators and policymakers. We share policymakers\u2019 interest in the ongoing stability of national currencies.\u201d<\/span><\/p>\n

That\u2019s why as lawmakers confer about how to regulate Libra, I hope they remember what triggered the last round of Facebook execs having to appear before Congress and Parliament. A totally open, unvetted Libra developer platform in the name of \u201cinnovation\u201d over safety is a ticking time bomb. Governments should insist the Libra Association thoroughly audit developers and maintain the power to ban bad actors. In this strange new crypto world, the public can\u2019t be expected to perfectly protect itself from Cambridge Analytica 2.$.<\/span><\/p>\n

Get up to speed on Facebook\u2019s Libra with this handy guide:<\/i><\/a><\/span><\/p>\n

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Facebook announces Libra cryptocurrency: All you need to know<\/a><\/p>\n<\/blockquote>\n

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Article source: http:\/\/feedproxy.google.com\/~r\/techcrunch\/social\/~3\/lZv0xsCs-mA\/<\/p>","protected":false},"excerpt":{"rendered":"

Everyone\u2019s worried about Mark Zuckerberg controlling the next currency, but I\u2019m more concerned about a crypto Cambridge Analytica. Today Facebook announced Libra, its forthcoming stablecoin designed to let you shop <\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[3],"tags":[10,7,14,15,6,12,11],"class_list":["post-15390","post","type-post","status-publish","format-standard","hentry","category-latest-update","tag-computer-news","tag-downloads","tag-microsoft-download-news","tag-networking-updates","tag-technology-update","tag-wordpress-plugin-download","tag-wordpress-theme-download"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t