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Is Libra Decentralised?

By Mark Lemon – Cryptocurrency Expert

Libra, the new ‘cryptographic money’ which utilises its own blockchain, has been designed with Byzantine Fault Tolerant (BFT) in mind, like many other blockchains are trying to overcome. BFT refers to the characteristics in which a system tolerates failures associated with byzantine problems. These kinds of faults are considered one of the hardest to deals with and can impact greatly. A system that is not resistant could find users buying crypto and potentially losing it due to behaviour from a bad node posing as an honest one.

Right now, the Libra Association is the body that will govern, however as indicated by the report, the expectation is later, it’ll evolve into a completely decentralised cryptocurrency. Every individual should therefore be able to approve new hubs and freely buy cryptocurrency on the network whilst able to cast their opinion on the direction of the blockchain.

The goal of the Libra Association is to gradually decentralise the network but will at first, the establishing individuals will hold the power. These individuals are from high profile companies that have an interest in the project and may buy and sell cryptocurrency on the network or integrate it in the future within their systems.

Libra, unlike when buying Bitcoin in which value is derived from demand and scarcity, will be backed by a reserve of real assets with an intrinsic value. This could encourage more to buy crypto that runs on Libra.

Can you Mine it like General Cryptocurrencies?

Essentially no. The Libra Blockchain will start with a Proof-of-Stake (PoS) framework in which the creator of the next block is chosen at random via a multitude of factors such as wealth to the age of the stake. Selection solely by account balance as many individuals have highlighted, can cause centralisation as any individual could buy crypto till they have the majority stake.

Another component has been made, the 'Libra Investment Tokens'. These are tokens provided to Libra Association members that are proportional to the number of dividends they can earn through interest on assets in the reserve, incentivising these organisations to invest in the project.

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