Blog

Why is Libra Cryptocurrency The Most Trending Thing Right Now?

Richard Marley
June 20, 2019
4 minutes read
4772

The universe of crypto revolves around an aversion to a central financial authority. The financial crash of 2008 made people skeptical of central banks. And the rising popularity of cryptocurrencies vindicates it. But now Facebook has announced to launch its own crypto coin, the Libra Cryptocurrency, which is not as decentralized as the more conventional cryptocurrencies.

Overview of Facebook Cryptocurrency

Facebook has announced that it will launch a cryptocurrency, Libra. People could send each other money over Whatsapp and Facebook Messenger, and purchase items online with it.

The reason for launching it – as mentioned in Libra’s Whitepaper – is to bring 1.7 billion people into the financial ecosystem which are not currently part of the conventional banking system.

With Facebook’s reach, it seems possible.

But it is important to know that Who is actually backing Libra?

Partners

Libra is primarily backed by the Switzerland-based Libra Association. It is also supported by the likes of Mastercard, Visa, PayPal, Stripe, eBay, Uber, Lyft, Spotify and Coinbase, among others.

Despite this strong alliance, there is a problem, trust, or the lack thereof.

If you do not trust the central bank and the federal reserve system then why would you trust Visa and MasterCard that are backing Libra coin?

This duality is obvious in Libra.

On one hand, it is using blockchain technology but it is not an open ledger, yet. This, perhaps, is to keep the network secure considering the security breaches of cryptocurrency exchanges we have witnessed in recent years.

Mark Zuckerberg on the Security of Facebook Libra Cryptocurrency

Mark Zuckerberg, the CEO of Facebook, understands security concerns. In a recent Facebook post, he specifically addressed this issue, “Privacy and safety will be built into every step… Libra will be regulated like other payment service providers,”.

The prevalent nature of Whatsapp and Messenger creates suspicion regarding the privacy and security of online transactions. Zuckerberg added;

“Any information you share with Calibra will be kept separate from the information you share on Facebook.”

What is Calibra?

Calibra is the e-Wallet or virtual wallet for the Libra coin. According to the official Facebook news source it will be available on Whatsapp, Messenger and as a standalone app.

Since there is a significant emphasis on the security of Libra’s functionality, it is unlikely for it to operate without KYC compliance and AML compliance.

How Libra Cryptocurrency is Different

Permissioned blockchain

Here is an excerpt from Libra’s Whitepaper;

“It is built on a secure, scalable, and reliable blockchain […] It is backed by a reserve of assets designed to give it intrinsic value, and it is governed by the independent Libra Association tasked with evolving the ecosystem.”

One way to look at Libra is that it is similar to Bitcoin as it is a digital currency that runs on the Blockchain, and offers smart contracts, much like Ethereum. Many are considering Libra more similar to Ethereum than Bitcoin.

Libra’s structure contains all the main features of Ethereum; the account model, generic language, gas, on-chain scaling with sharding among others.

The Good

We have already seen so much chaos in the world of cryptocurrencies that a name such as Facebook seems like a good addition. The breach of users’ private data through Facebook did not deter its two billion users. On top of that Libra is a stable-coin.

The Bad

Security is a major concern. The real reason behind the potential abuse for Libra is crooked developers. Facebook intends to allow anyone to build apps on Libra’s platform in the future. The escapade of Cambridge Analytica which resulted in the breach of 87 million people’s personal data is still fresh.

What Libra Means for the average Facebook User

If you are a happy user of payment system such as PayPal or Skrill, Libra might not mean much for you. But those people are not Facebook’s target audience.

The real market for Libra are the people sending money to their loved ones from abroad. This also includes the 1.7 billion people that are currently outside the realm of traditional banking. That perhaps is the biggest target market as far the cryptocurrencies are concerned.

Disclaimer: No warranty is herein provided that the information contained in this document is accurate, up-to-date, and/or complete. In no circumstance(s), does such information constitute legal or any other advice. Any person who intends to use, rely, pass-on, or re-publish the information contained herein in any way is solely responsible for the same. We suggest to verify the information and/or obtain expert advice independently if required.

Latest News

News
1803 Arrested in Money Laundering Crackdown Coordinated by 27 Countries
Overview of Facebook Cryptocurrency
How Libra Cryptocurrency is Different
In a major money laundering crackdown, European police identified more than 18,000 money mules, arresting a total of 1803 individuals.

On December 1, the seventh European Money Mule Action (EMMA 7) concluded after two and a half months. 27 countries were involved in this initiative along with Europol, Eurojust, the European Banking Federation (EBF), the FinTech FinCrime Exchange, and major companies from the private sector including Microsoft, Western Union, and Fourth line.

The EMMA has been operational since 2016 and the purpose of this initiative was not only to identify money launderers but also the sources of their illicit gains.

According to Europol, the EMMA initiative is the biggest international operation of its kind, where 400 banks successfully reported 7000 fraudulent transactions. As a result, losses counting up to €70m ($79m) were prevented and 324 recruiters were identified.

Europol also claims that money mules are used for money laundering and a variety of online scams, including e-commerce fraud, phishing, SIM-swapping, and man-in-the-middle attacks. These claims are based on the leads that came in from police intelligence and private-sector reports.

Immigrants, students, and those in difficult financial situations are often targeted by giving the hope of easy money. They are approached through various methods including job adverts on social media.

Fraud experts and police issued warnings of an increase in the recruitment of money mules in the pre-pandemic time. A spike was seen in these scams when many lost their jobs during the COVID outbreak.

Recruitment of money mules and the subsequent crimes have called for the police to run regular awareness campaigns like Europol’s “Don’t be a mule” initiative.

Suggested read: Money Laundering Ring Pushed $4bn through 60 HSBC Accounts within 2 Years

Recent Posts

Blog
Top 5 Cybersecurity Trends to Look Out for in 2022
Overview of Facebook Cryptocurrency
How Libra Cryptocurrency is Different
With 2022 just around the corner, new developments in cybersecurity are already beginning to take shape. Considering the 600% upshot in cybercrime amid the pandemic, the urgency for cybersecurity is further augmented. Given the dependency of modern businesses on digital solutions, it is safe to say that the corporate world may undergo monumental upgrades. New regulations for cybersecurity updates are inevitable to combat the increasing number of cyberattacks.

According to reports, cyberattacks contributed to losses of up to $6 trillion in 2021 alone, which is the single largest economic upset in history. By 2025, cybercrimes are expected to cost the world $10.5 trillion. As governments work towards elevating their cybersecurity posture, the key criteria here is the extent to which businesses can adopt the best practices.

1. Phishing Attacks to Remain a Major Issue

Although Canada is far ahead as compared to the rest of the world in mitigating cyber threats, 78% of Canadian organizations still faced a cyberattack in 2020. This indicates the catastrophic effect of cyberattacks with numbers rising in the negative direction. The most common type of cyberattacks took the form of ransomware and phishing. Looking at the trends of 2021, it’s clear that hackers and malware are becoming advanced with improvements in technology.

A rise in phishing attacks was observed this year, as fake COVID-19 vaccination drives led to e-commerce fraud where credit card information was collected by bogus online shops. The number of overall data breaches recorded by September 2021 was 1,291, which had already exceeded the total of 2020. In order to avoid becoming the victims of phishing sites and emails, businesses must elevate their identity verification measures and conduct employee training. For this reason, the demand for cybersecurity professionals will further increase in 2022, as companies will need their guidance to stay ahead of their competition.

2. Internal Threats & Cloud Attacks

Trojan horses are rightfully named as they can effectively wipe out a large amount of data. However, the origins of all cyberattacks are not malware, as statistics show that 15 to 25 percent of data breaches were due to the involvement of corrupt employees or business partners. In the coming times, virtual workplaces will further gain prominence and companies will need to be more careful at the same time. Therefore, it is becoming essential for businesses to control access levels for new employees, freelancers, and third-party suppliers.

As the pandemic forced businesses to improvise and follow remote working procedures, a lot of data sharing, communication, and other activities are being conducted through cloud services. Although this enables businesses to stay connected and generate revenue regardless of the location of employees, it has a few drawbacks in terms of cybersecurity. In 2022, cloud services are expected to be used by an increasing number of companies as they strive to adopt virtual or hybrid solutions even after the pandemic’s restrictions.

On one hand, cloud services allow scalability and flexibility in business processes. On the other hand, they create risks of cyber attacks and data breaches. 2020 saw more data breaches through cloud systems as compared to on-premises storage. This means that banks and financial institutions will have to take necessary countermeasures to secure their cloud systems and confidential information. In order to avoid data breaches, businesses must not leave out any gaps in their security systems and raise awareness among their staff to follow the best practices for data privacy.

3. Artificial Intelligence as a Saviour

Considering the cybersecurity trends for 2022, artificial intelligence has become increasingly necessary to establish a strong frontier against cyberattacks. In 2020, 47.3% of companies had a medium to high-security automation level, which was a significant increase as compared to 39% in 2019. The basic concept behind AI comes into play here, as experts suggest that the higher the level of automation, the more secure a business system will be.

An officer in charge of security can make errors like falling prey to a phishing email, but today’s advanced AI systems can easily detect such attacks. Automation of security systems also reduces the risk of internal threats as a lesser number of humans will be able to leak confidential information. Moreover, AI allows much more accuracy in analyzing risk as compared to humans.

4. Securing the Supply Chains

A number of cybersecurity concerns are raised due to loopholes and insufficient security protocols in supply chains. These ultimately give way to numerous false allegations on vendors and third parties. However, the industry has responded to this with a positive approach to improve vendor management as a cybersecurity measure. This is being considered as one of the key focus areas for 2022, starting from the disclosure of business information. Despite cloud service providers claiming that a centralized storage system is far more secure, the coming year will prove that this is not true.

As seen from reports of cyberattacks involving cloud storage, the current business operations actually turn out to be the opposite of secure. Businesses will need to incorporate KYB (Know Your Business) measures to verify their partners, third-party vendors, and suppliers. Unless companies put it all on the table at the start of the collaboration, they are welcoming cyber attackers to breach their data. For example, such exposure was created by Amazon in a reported event where AWS appliance installations were hacked. Therefore, it’s clear that 2022 will see more cyber threats unless work is done to improve security.

5. Identity-based Security Protocols

As the techniques of fraudsters continue to evolve, personal information on digital platforms is becoming increasingly vulnerable to cybercrime. To overcome the theft of financial information, digital banking platforms will need to incorporate identity verification measures. With the new methods of hybrid work and the transfer of major business data to cloud applications, the importance of identity verification is further justified. Although the concept in itself is nothing new, the urgency for cybersecurity will force its adoption in companies.

As most cyberattacks begin with a stolen identity, managing the access protocols will be a key aspect in maintaining a business reputation. Misuse of credentials and data breaches will mean the end of small businesses if the modern cyber attackers capitalize on the loopholes in their system. Business directories and employee registries must be configured with security barriers like 2-factor authentication and transaction monitoring systems should be incorporated to detect suspicious activities.

Key Takeaways

Sooner or later, banks, financial institutions, and businesses will need robust identity verification solutions to eliminate the root cause of cyberattacks. Onboarding of legitimate individuals can only be ensured when the company knows who they are every time they try to access the system. Based on the trends, data breaches and ransomware are not going to be eliminated any time soon.

Want to learn more about on-premises solutions for your business?

Talk to experts

Why is Libra Cryptocurrency The Most Trending Thing Right Now?

Overview of Facebook Cryptocurrency

Partners

Mark Zuckerberg on the Security of Facebook Libra Cryptocurrency

What is Calibra?

How Libra Cryptocurrency is Different

Permissioned blockchain

The Good

The Bad

What Libra Means for the average Facebook User

1. Phishing Attacks to Remain a Major Issue

2. Internal Threats & Cloud Attacks

3. Artificial Intelligence as a Saviour

4. Securing the Supply Chains

5. Identity-based Security Protocols

Key Takeaways

Let’s prove your

customer’s identity

with Shuftipro.

Let’s prove your customer’s

identity with Shuftipro.