The first time I wrote about blockchain and crypto in the article “Can blockchain give an all equal playing field?”, I was making a case that the best and only use of all this was to invent new financial and financing models.
I still was underestimating to what extent!
I mean, who would have imagined that a group of tech corporates will one day announce that they were launching a currency that will be global?
Tuesday's announcement of Libra is a huge deal for monetary systems, financial services and the crypto space in general.
Bitcoin had already challenged to an extent the idea of “issuing a currency” when you’re not a central bank of a government.
However, behind bitcoin was a group of geeks often referred to as anarchists.
Yesterday, project Libra was announced with an impressive list of founding members, far from being “anarchists”, with a mission to build a global digital currency.
In this context, we might be entering a new milestone in the evolution of our perception of “money” and more broadly, governance.
What will happen when people and businesses start transacting Libra more often than their government issued money?
Considering that Libra is a fully digital currency, holders will store it themselves in their wallets and not in banks as we were used to.
When Libra is broadly adopted, the idea of a “bank” will not only be challenged, but will also transform the financial services space like consumer loans, remittances and insurance to mention but a few.
Furthermore, any player will be able to build and offer those services programmatically and with very little frictions.
Today, if you wanted to transact crypto, you would need to be conversant with tech. Yes, it has become easier over time, but still, the route to installing a wallet to purchasing crypto through the KYC process is very cumbersome. What happens when WhatsApp becomes your crypto wallet?
There is still time and probably many challenges ahead to start seeing broad adoption of Libra and other cryptocurrencies, but one cannot ignore the significant milestone it is towards the day the world has a global, non-government issued, digital currency. I am personally more excited than worried about the perspectives.
The author is the country director of the Andela Kigali and the chairperson of the ICT chamber of the Rwanda Private Sector Federation.