Don’t mention that it’s a comeback. Bitcoin, the world’s largest-valued cryptocurrency in terms of market cap relishes a seasonal rally. The price of one coin lately shot more than $10,000 for the first time since the first three months of 2018, reintroducing anticipation about the future for the infamously volatile digital asset.
Now, what could be influential in this current rally? Anyone can never say for sure what forms an asset’s price goes down or up. But several analysts have pointed to the amplified attention on the technology that was risen by Facebook’s launch of Libra.
Facebook’s Project Libra
Libra is a digital currency that Facebook established in-house and which remarkably deviates from bitcoin’s central principle of decentralization. Since Facebook announced its Project Libra white-paper, individuals who are familiar with the issue are venturing on whether this can impact the price of Bitcoin – Including the cryptocurrencies in general.
While many crypto specialists say that Facebook’s Libra is not a cryptocurrency, many still say that this is an excellent thing for crypto overall. Let’s take a closer look at the information of the Libra cryptocurrency and what it meant for bitcoins.
The Libra is Not Bitcoin
One of the prime differences lies in the fundamental technology behind both currencies. With bitcoin, dealings are documented anonymously on a public register known as the blockchain. Libra, on the other hand, also uses a type of blockchain or circulated ledger technology. But distinct from bitcoin, Libra’s blockchain is allowed — at least for now. Meaning, transactions can only be added to it through a group of responsible parties.
Also, another main difference between the two currencies is that a handful of government-issued authorization currencies supports Libra. For that reason, it could have a political effect on Libra when Facebook’s cryptocurrency is being affected by criminals or parallel type of activities. Libra could be shut down in that case, but how will it affect bitcoin price?
Libra ‘Won’t Affect the Price of Bitcoin
Libra, in theory, cannot impact the price of Bitcoin since it most expected that it won’t have a straight influence on the cryptocurrency market. However, it can assist individuals in learning about crypto terms and activities.
Facebook will deliver an attention-grabbing wallet app, which will be very handy to use. We will get used to that, and soon, as they will grasp the effect of Facebook on their money and data, they will potentially begin searching for other currencies.
People will realize the benefit of Bitcoin, and most probable, they will initiate looking into it more. So, if we perceive this condition from this point of view, more Bitcoin users equate to more expensive Bitcoin. In the long run, we can see a growth in the price of Bitcoin, but directly because of the introduction of the Libra ecosystem.
We should always note that we’re talking about Facebook here – the social media giant. With everything in its privacy-related issues over the years, it is successfully opposing everything that bitcoin represents.
Libra seems to be nothing more than a type of the traditional financial system. As the world’s most prevalent cryptocurrency’s main value proposition is an apolitical store of the medium of exchange, this must not have much impact on the bitcoin price.