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In the UK, I have low-cost, fast, reliable, accessible money transfers. Basic bank accounts are free, and come with reliable free instant transfers to any other UK bank. That may not be reality in all countries, but it is in many.

That's quite a high bar for rival payment methods to clear, but I think the main problem for corporate currencies like this will be rivalry from government issuers. Governments jealously guard the right to issue currency, as they rightly perceive it as one of their biggest holds over citizens. Any sufficiently powerful currency would attract their scrutiny.

I do think payments are ripe for disruption though - when money is sent over a free global network between pre-vetted partners (i.e. bank customers) there is no reason the transaction fees should be high, even internationally. I'm not clear how a blockchain based currency is going to help facilitate that, but would love to see a revolution in payments which made them simpler and not tied to archaic concepts like sort codes and account numbers, and reduced the fees charged to customers and merchants for payment networks or card issuers which don't do the hard KYC work (banks and payment processors do that).

The problems here are in verified identity tied to real people, not how to perform transactions quickly, or things like anonymous trust-free transactions which nobody actually wants.

> In the UK, I have low-cost, fast, reliable, accessible money transfers. Basic bank accounts are free, and come with reliable free instant transfers to any other UK bank.

As an EU citizen living in the UK, it boggles my mind that "EU Faster Payments" was not implemented as part of the eurozone, if not the EU as a whole.

As far as I know there's nothing technically preventing this, anyone has an insight into why it isn't a thing?

>As far as I know there's nothing technically preventing this, anyone has an insight into why it isn't a thing?

Banks wanting to make more money?

Sort of, indirectly. The biggest incentive is not having to invest in the new infrastructure required to comply with the standards.

Cybersecurity/trust issues? Can’t imagine a region wide inter bank network to be more technologically better protected than even Gmail.

It does exist, but it’s just taking a while for all banks to adopt it.

Most/all Dutch banks have adopted it already.

https://www.europeanpaymentscouncil.eu/what-we-do/sepa-insta...

That's great, thanks for the pointer.

In France banks charge a small fee for instant transfers (around €1). Some banks include free instant transfers in some of their offers, but usually not for their free accounts. I think it’s just a matter of time for it to become free and universal. Just like some banks use to make you pay to use their app or website (!).

I regularly transfer money between three European countries with instant payments, it works just fine but not all banks have implemented it.

> In the UK, I have low-cost, fast, reliable, accessible money transfers. Basic bank accounts are free, and come with reliable free instant transfers to any other UK bank. That may not be reality in all countries, but it is in many.

It is also a reality in Brazil. Last month the government and the banks released a standard money transfer protocol (PIX) which superseeds the other protocols (similar to ACH in USA). Cheap, instant payments 24h a day regardless of the bank are a reality here today.

Hence I don't see FB having much success in Brazil with this product.

What about sending money out of Brazil, and non-permanent residents of Brazil?

Any person with a CPF, our individual taxpayer registry identification, can use PIX. Non-permanent residents of Brazil are included in this category.

As for international transfers, the Central Bank is looking at simplifying existing regulations in order to allow international transfers as late as 2023

> I don't see FB having much success in Brazil with this product.

Really?! They just need to tie whatsapp payments with a novi wallet, perhaps offer a few bucks as bait and suddenly they get millions of users.

Never underestimate the power of a monopoly position.

> not tied to archaic concepts like sort codes and account numbers

What are the problems with sort codes and account numbers? Are you after binding the account to your identity like Australian PayID?

Odd thing given the UK context - the major banks and many smaller let you pay someone with just their mobile number (it’s called PayM). Although given its bank payments, account numbers are far from archaic, and new things like confirmation payee help make the whole system more secure. Now it you want to talk about archaic, how about MT103 and friends?

I quite like the inversion of account control in systems like bitcoin to put the user in charge, though this is not without problems. It would be nice if uk banking systems were not stuck in this odd world of accounts tied to physical branches by a sort code, or indeed if we just moved to global identifiers that were portable between banks and owned by a person, not a gov or bank.

even in the countries where you do have this, what about cross-border transactions...those usually again become messy. Even between two countries which each have a good internal system as you describe.

> Is there a reason this is tied to the blockchain?

The only legitimate reason I can think of would be cynically drafting on the hype cycle. But I've been reading David Gerard's book Libra Shrugged [1] and it looks like the actual answer is that "blockchain" has a quasi-religious belief system built up around it, and the people involved are members of the faith.

One of the stunning things for me about "blockchain" revolutionary hype is how long it has gone on without significant accomplishment. It started only a bit after the iPhone, which has had a huge impact on things, including payments. It's hard now to imagine a world without the internet in one's pocket. But if every blockchain stopped working tomorrow, few would notice. Contrast this with M-Pesa [2], a different approach to digital money. It started at around the same time but has had huge uptake. A recent report in Kenya [3] says M-Pesa has 30 million accounts, which is approximately the number of people in Kenya age 15 or over. To me, that's what successful digital money looks like.

[1] https://www.amazon.com/dp/B08M8DGKY4/ [2] https://en.wikipedia.org/wiki/M-Pesa [3] https://ca.go.ke/wp-content/uploads/2020/07/Sector-Statistic...

Could just be thanks to technology office politicking. Some senior engineer or manager says "I want to work on blockchain projects", invents a reason to do that within Facebook, or maybe their boss really wants to keep them there, and somehow they get enough buy-in to create Libra. Now they have a blockchain project.

This seems more likely to me than someone at Facebook saying "We need a our own money system," evaluating blockchain against a centralized design, and deciding for technical reasons that Facebook Money should be a blockchain project.

> Some senior engineer or manager says "I want to work on blockchain projects", invents a reason to do that within Facebook, or maybe their boss really wants to keep them there, and somehow they get enough buy-in to create Libra. Now they have a blockchain project.

This is pretty much how it happened. A Bitcoin fan started at Facebook, started from "how do we use a blockchain here" then came up with something to use a blockchain for, and recruited some executives who thought similarly.

Most of what's weird and dumb about Libra/Diem is because it was started by four bitcoiners, from bitcoin ideas. It turns out that ideas from a cryptocurrency that was started in order to evade government control don't play well in the heavily regulated environment of Other People's Money.

> One of the stunning things for me about "blockchain" revolutionary hype is how long it has gone on without significant accomplishment.

I think that there is a lot more money in the world right now than 20 years ago and definitely than 400 years ago.

A lot of it is just dumb (people inheriting money or getting it for other reasons than intelligence or financial acumen: singers, athletes, etc.) and some it is exploratory/inherently risky (VC) or both. So a bubble can last much, much longer and be much, much bigger.

We're probably going to see more of these.

I guess at this point I should probably just say that I regret not being smart/connected enough to be at the collecting end of one of these hype trains :-)))

I think Zuck's mission wasn't really about empowering the unbanked, but it's: fight WeChat. WeChat already has an effective digital payment system, with the tasty tasty analytics and surveillance capabilities (which yeah, Zuck also probably wants).

As to blockchains, that's because this is the hype of the last few years, is it not?

As to currencies, IMO the vision of the people hyping bitcoin was that your pizza place would accept BTC (and not after converting their USD price to BTC) because their supplies would be happy to do as well. A single currency for the world would be interesting, but as economists have pointed out, devaluing your currency is a way to escape economic crises, but e.g. Euro countries can't do this any more, hence the problems the PIIGS countries had.

Blockchain or not blockchain is perhaps the least interesting part of all the so called "blockchain" projects.

It's a term without an accepted definition. A lot of useless branding is expected. Just you wait until IBM gets their hands on .. oh, they already did.

Both the Bitcoin-like zero trust ledger and the m-of-n trusted notaries model have useful use cases. While more descriptive terms would have been great, arguing definitions only goes so far.

No part of the Libra/Diem plan required or requires a blockchain.

The reason for the blockchain: Libra was founded by four bitcoiners (Morgan Beller, David Marcus, Kevin Weil, Christian Catalini) who wanted something like bitcoin, but not volatile, and run by sensible people, i.e. them.

Facebook Messenger can already transfer money between people. They could just expand that into a fully featured digital wallet to compete with WeChat, Apple Pay, Google Pay, Samsung Pay, Cash App, PayPal, etc. It's actually astonishing they didn't do this a decade ago.

I get the VC appeal of blockchain, but Facebook already has the money to fund it. Outside tech circles I don't think slapping a blockchain label on a product will make it more appealing.

> Outside tech circles I don't think slapping a blockchain label on a product will make it more appealing.

I kind of hope the word "blockchain" should soon make it less appealing especially in tech circles.

I agree. I don't quite understand what overall benefit something like Diem brings. It seems like an extraneous amount of technical overhead and yak shaving just to do something other companies have been doing for years. It just strikes me as some convoluted marketing ploy to attract VCs. All Facebook needs to do now is figure out how to throw AI into the mix and they'll win tech buzzword bingo.

1) think of it as a centralized database that needs replication, you’d be a bit worried if this central place got attacked, so then you need some gossip-based protocol in place to allow some users to police the system. Consensus is a simple one because it allows most users to trust that consensus was agreed on correctly, as opposed to systems like transparency protocols that require users to more willingly engage in policing.

2) it is tied to non profits as well! The whole point is to fund this project by companies, no a company

3) we will support single currencies (a USD coin, for example)

4) that’s what we’re working on!

2) Does Facebook (or any other for-profit company) get access to the data (now or ever in the future)?

3) So if I want to send money (from say GBP) to someone in Japan, what would happen? Is the FX exchange seamless or will I need to use some intermediary coin?

2) I don't believe so. 3) The hope is you don't have to use an intermediary coin.

They have declared that they will not access the data.

However, Facebook makes extensive use of shadow profiles of people who aren't even Facebook customers. They could certainly add Diem blockchain data to those, as they will have access to said blockchain via Novi, their Diem wallet.

David Marcus and Mark Zuckerberg have both stated that data from Novi will not go to the Facebook advertising engine. However, Zuckerberg and Facebook's track record on such promises is that they consistently do this anyway. Then Zuckerberg apologises, then he does it again.

Just by looking at Facebook's past behaviour, you can assume that an important purpose for Diem is to collect personal information. Because everything they do is to collect personal information.

> Because everything they do is to collect personal information.

Are you really really sure that some of the things Facebook (and Google) does aren't done just to spite us ;-)?

As I said elsewhere this is not related to Novi. Novi is just a wallet using DIEM, and will have its own users (like any wallet or bank or trading platform has).

That being said, there is a lot of work being put in making sure that FB doesn't have access to Novi user data. Of course, sometimes one employee's mistake can lead to infringement of a claim, so to avoid that good frameworks have to be put into place.

What other Diem Association members have even announced plans to issue a wallet?

As I understand, that number is presently zero. (Please correct me if I'm wrong on this.) And unhosted wallets won't be allowed - all consumers will need to transact via a Diem Association member. So Diem usage really is 100% Novi for the known future.

Hey David! I'm actually unsure about these so I'd rather not comment besides the fact that Diem being 100% Novi would be bad (or useless) yes.

2) It's a transparent payment network, so everybody (even you) gets access to the data on the network

3) That's a complicated answer that involves more than just the blockchain (as you need to convert fiat from/to digital currency) so it depends on the VASPs (the wallets) not on DIEM.

If a sufficiently large nation state orders the companies involved to deny or override a transaction, is the gossip protocol/blockchain useful at all in denying this? Or is this one of those mechanisms only used for keeping out low level/underfunded attackers?

The system is governed by an entity in Switzerland that must follow regulations, so such a scenario would not be an attack on the system (and thus not be in scope for consensus). That being said, I don't know much about laws and regulations so that's the extent of my understanding :)

Since one of the major audiences is emerging economies, what happens if one of them goes to war with another? Can one side get their superpower patrons to order Diem to freeze the accounts of the other?

I think that's a problem not just for Diem, but for current banks too. I remember reading about HSBC having to shut down Carrie Lam's accounts due to the US putting her a bunch of other government people in HK on some sanctioned list. I think HSBC actually did not freeze the accounts due to the consequences this would lead to for them and the Chinese market? It's unclear to me what happened and what will be the consequences.

> low-cost, fast, reliable, accessible money transfers - clearly something missing right now in this world

Missing in the US.

At least Europe has had those for a long time already, using normal banks.

I'm not sure I agree. First of all, it's not "Europe" but rather "Euro-accounts" (so no cross-currency transfers). Also not that fast - don't work overnight, on the weekends, payments might take a day to arrive.

I just checked - paying 10EUR from my UK account to the EUR area takes 2-4 days (I'd need to pay 15GBP for an "urgent" next-business-day transfer) (same rate as TransferWise) whereas if I want to send 10kEUR I'd pay 250 GBP (!) for a "no-fee" (!!) transfer than with TransferWise (a.k.a. scam). Paying from EUR to EUR account (cross-border) costs about 0.1% (0.38 EUR fee to send 350EUR) which isn't too bad.

Suffice to say, room for improvement.

That's from UK to SEPA, which has a delay. SEPA transfers themselves are mostly instant since about 2018.

There's sometimes a nominal fee across countries (mandated to be "no more than a local transfer"), but in many cases they are free.

I’m hearing about mostly instant SEPA payments but I’ve never seen them personally. DBank to DKB takes a few days, DKB to ING, the same, to bunq or N26... First direct in the UK to a EUR account. My limited anecdotal experience is “mostly delayed by at least a day.” am I really an outlier?

I've used them a few times for personal transfers. Each took less than 30 seconds until the money was booked out of my account and booked into the receivers account.

SEPA in my experience has never taken longer than 1 day unless it's SOFORT-related, which in my experience takes a bit to confirm (but the merchant knows you issued a transfer so they can rely on that).

The 250 GBP must be the exchange fee? If your account is in GBP and the destination is in EUR, the bank gets to charge you for the exchange. 2.5% is a typical rate. That's unfortunate, but is unrelated to the cost of transfer.

Euro transfers have become instant and 24/7 thanks to the SEPA Instant Credit architecture:

https://www.europeanpaymentscouncil.eu/what-we-do/sepa-insta...

You can transfer up to 100k EUR in less than ten seconds; works overnight and during weekends and holidays.

In the UK, at least Revolut supports this already:

https://blog.revolut.com/sepa-instant-euro-transfers-now-ava...

Maybe it is typical with 2.5% in the UK but here in Sweden the typical is 0.5% so I feel like you are being robbed.

I don't mind the fee per se I just object to obfuscating it (which I term "fraud" thought that might not be the legal definition).

NatWest app says £0.00 fee and some FX rate but when I compare with TransferWise, the difference is £250, which means that the "FX rate" implicitly contains the fee.

Maybe not "fraud" legally but I don't want to support such non-transparent business practices.

If it's a fixed cost, it's a fee

Yes banks charge commission (where TW usualy has a cost advantage but anyway, it's a money maker for banks and calculation of the fx rate to be used at a given moment is not something simple)

TransferWise also supports instant SEPA payments. The first time I transferred money to my bank in a different country and I received immediate confirmation I was mindblown.

My Revolut account is moving to Lithuania though. Are UK customers keeping their UK ones?

From experience with bank accounts from 4 different European countries those instant transfers definitely don't work everywhere and are often accompanied by an extra fee.

Edit: And this is 2020. I highly welcome some innovation in this field - five years ago..

> "If your account is in GBP and the destination is in EUR, the bank gets to charge you for the exchange. 2.5% is a typical rate."

2.5% is a rather expensive fee for a GBP-EUR transfer, especially on £10,000! Some banks offer as low as 0.4% (on top of the real mid-market rate), probably even less on large transfers.

I think that is mainly UK banks bring bad. Here in Sweden which is also not a euro country the exchange fee is roughly 0.5% at my bank and they charge 3 euro for non-SEPA transactions and 0.15 EUR for SEPA transactions. So I would need to pay 50 EUR to transfer 10k EUR from my SEK account and just 0.15 EUR to transfer from my EUR account.

Here in Canada we have e-transfers securely from bank account to bank account, in minutes/hours.

and they are a LOT more expensive than their crypto counterparts

No, they are cheaper, by quite a bit.

Unless you count cryptocurrencies nobody actually uses.

These are great questions. Here are my thoughts / answers:

> 1. Is there a reason this is tied to the blockchain

For FB, you're 100% right. FB could have likely just used a relational DB in the short term. However, if you don't want to tie this to a single company (your second question), then a blockchain does make it easier for multiple entities to agree on the state of the db. I would argue that modern Proof of Stake protocols are starting to be competitive with Proof of Work in terms of security, in large part because unlike Proof of Work, they allow for both positive _and_ negative incentives for incentivizing behavior. For example, we've yet to see the types of double spend attacks on newer PoS chains (e.g. Cosmos) like the ones we saw on Ethereum Classic a few years ago.

> 2. Is there a reason this would be tied to a company

No, and in fact, this is what makes most permissionless blockchains so valuable. The problem is that most of them are not useable enough for what Facebook wants to accomplish. I say most because, in my view, Celo (https://celo.org and https://valoraapp.com) does. It's permissionless, programable, highly scalable, has a built in stablecoin and identity protocol, and most importantly, uses new zk-SNARK cryptography to let mobile apps sync trustlessly and near instantly. It also offsets 100% of its carbon emissions by buying carbon credits using block rewards.

> 3. Why a "new currency" ("stablecoin")?

I agree 100% and already the market is starting to tell us that USD pegged stablecoins are the most interesting of stablecoins.

> 4. I'm sure there are many issues with fraud/reversible transactions/KYC/anti-terrorism/anti-money-laundering that would need to be resolved somehow

Yes! This is an interesting read on the topic: https://www.coincenter.org/how-i-learned-to-stop-worrying-an...

Thanks! Celo looks very interesting, I gotta try it next time I'm transferring money!

The answer is: even if any of the above held, Facebook are doing it to:

(1) build a giant sucking data-miner atop all consumer commerce;

(2) print their own money in such quantities that governments can't tell them what to do any more;

(3) establish themselves as providers of the digital identity standard for the world, so that you need to go through Facebook to use money at all.

There are those who have proposed Libra-like basket currencies seriously; Yanis Varoufakis seriously proposed that the Libra 1.0 plan would be a great idea - if done by a public institution such as the IMF, and not by a private company. https://archive.is/YKgQ9

For those unfamiliar, davidgerard wrote a great book on blockchain hype: https://davidgerard.co.uk/blockchain/book/

And has recently come out with a book on Libra. I haven't finished it yet, but it's great so far: https://davidgerard.co.uk/blockchain/libra/

You pretty much just described Stellar. Take a few minutes and watch Coinbase’s intro materials on it: https://www.coinbase.com/earn/stellar/lesson/1

Quite different. Stellar facilitates pinning to foreign currencies, a different problem from moving money between countries.

I like your thoughtful breakdown. Thanks for that.

The video shots of small merchants and everyday people, with voiceover "what if everyone is invited to global economy" was bothersome to watch. I don't like their underlying characterization that the lack of frictionless banking and payment systems are what's holding back Africa and poorer parts of the world. It's just not true.

> Basically, I think the underlying idea is valuable - low-cost, fast, reliable, accessible money transfers - clearly something missing right now in this world, even for the "global rich" (citizens of first-world countries), let alone for the "unbanked".

For most of the "banked" in the US, doesn't Zelle cover all that for transfers within the US?

It's still absurd that you need additional services just to do transfers. I can't understand why an IBAN-like system can't seem to get off the ground in the US.

Zelle is owned by several major banks, and partnered with many other banks and credit unions. It is incorporated into most of their mobile apps and online banking websites.

From a user point of view, it doesn't look like an additional service.

I moved from Europe to US via UK, so I’ve experienced banking systems in Eurozone and GBP.

Zelle doesn’t feel as convenient as regular bank transfers in Europe or UK. Some problems I experienced:

- You have to sign up separately. There’s no guarantee a recipient has enabled it.

- It’s tied to an email address for some reason. (Euro/UK bank transfers just use the regular IBAN.)

- There was a long delay in receiving and sending money when one of the Zelle accounts was new. (My transaction was stuck for at least 24h in a “pending” state.)

- The daily transaction limits are very low. My NYC rent doesn’t fit even in two Zelle payments! (In Europe, the standard limit for an instant SEPA bank transfer is 100k, and it costs nearly nothing.)

For these reasons Zelle feels very unbaked, and doesn’t replace a proper interbank fast payment system like SEPA in Eurozone.

I guess there's no/little money on these when you can sell higher cost alternative solutions.

Zelle, Venmo, PayPal, Square, Apple Pay - there are a ton of companies that all do this same thing in the US because the bank software is terrible and expensive.

I thought stellar was similar to what the parent comment describes, but it’s also not proof of work (which makes need for blockchain unclear).

https://www.stellar.org/

> Zelle, Venmo, PayPal, Square, Apple Pay - there are a ton of companies that all do this same thing in the US because the bank software is terrible and expensive.

For all intents and purposes, Zelle is the bank software, and it’s free. Zelle is backed by a bunch of banks - the majority of US checking accounts have access to use it at no cost.

I just checked out Stellar... sounds really interesting actually, very much in line with what I described (except blockchain - I can't see if it's public (not good) or private (not much point in it then) but I'm open to being convinced otherwise), there's just one problem... how do I even use it?? There's no app, no nothing. Ideally, I'd like something like TransferWise "I'd like to send money to X" just non-profit.

fwiw, Stellar integrates directly with Keybase.¹ I remember they did an airdrop when they launched and deposited ~100$ worth of XLM into every Keybase users' wallet.

Not sure how interesting Keybase is now, but it does allow sending money to other Keybase users directly through chat.²

[1] https://keybase.io/blog/keybase-stellar-launch

[2] https://book.keybase.io/wallet#chat

I don't understand why people just can't use Ethereum for this with a little more polishing on the UI end from the devs. It has the added benefit of being decentralized, something Facebook or any other company or charity will never be. It even recently implemented proof of stake rollout so it isn't using massive environmental resources for proof of work in the future.

Of course Bitcoin was ideal for this but it went off the rails for the banking the unbanked dream when it refused to scale from a blistering 7 transactions per second and the associated high fees. Ethereum fees aren't great either, but my understanding is that massive increases in throughput are coming with sharding etc. in Ethereum 2.0. Monero would be perfect for this, but I don't know if the world is ready for true privacy and fungibility in their e-coin.

https://bitinfocharts.com/comparison/transactionfees-btc-eth...

Of course Bitcoin was ideal for this but it went off the rails for the banking the unbanked dream when it refused to scale from a blistering 7 transactions per second and the associated high fees.

You can check any bitcoin dashboard (such as https://bitbo.io); the current transaction fee is 1 satoshi/vByte for a transaction. The average bitcoin transaction is ~250 bytes. 1 satoshi = $0.00019273. A transaction that can wait an hour costs about $0.05.

The "bitcoin doesn't scale" thing really isn't a thing. Lyn Alden addresses this in her "7 Misconceptions about Bitcoin" article [1]:

"In other words, suppose that the Bitcoin network is limited to 250 transactions per minute, which is low. Those transactions could average $100 or $1 million, or any number. If they average $100 each, it means only $25,000 in transaction value is performed per minute. If they average $1 million each, it means $250 million in transaction value is performed per minute. If Bitcoin grows in use as a store of value, the transaction fees and inherent limitations prioritize the largest and most important transactions; the major settlement transactions.

Additional layers built on top of Bitcoin can do an arbitrary number of transactions per minute, and settle them with batches on the actual Bitcoin blockchain. This is similar to how consumer layers like Visa or Paypal can process an arbitrary number of transactions per minute, while the banks behind the scenes settle with larger transactions less frequently."

Lightning Network is a layer 2 protocol on top of bitcoin; transactions settle in seconds and the fees are tiny—about 1 satoshi—(a fraction of a penny) per hop. Not only are they cheap, they're private as Lightning runs over Tor.

The UI/UX of the current crop of Bitcoin/lightning wallets for iOS and Android, such as BlueWallet (https://bluewallet.io) is quite good.

[1]: https://www.lynalden.com/misconceptions-about-bitcoin/

Not to put too fine a point on this, but here's a tweet about a $165,000,000 bitcoin transaction; the fee was $1.20: https://twitter.com/coinbeastmedia/status/133612299565221888...

I don't understand why people don't revisit DigiCash (https://en.wikipedia.org/wiki/DigiCash) for this kind of usecase. It seems like a really good fit for this type of usecase where you are giving up on the proof-of-work aspect of bitcoin, but want all the other cool properties of cryptocurrency, and has better anonymity properties.

They do. It's called Taler ( https://taler.net/ )

GNU Taler seems to not let people receiving payments be anonymous, which to me seems like a rather random design choice that has nothing to do with the underlying technology and severely limits Taler.

> Basically, I think the underlying idea is valuable - low-cost, fast, reliable, accessible money transfers - clearly something missing right now in this world, even for the "global rich" (citizens of first-world countries), let alone for the "unbanked".

I can send money to friends via PayPal or Venmo completely free. What’s missing?

Its not too fast (from bank account to bank account takes 1-3 days or so). Venmo is also arguably not free, since it contains ads now.

> low-cost, fast, reliable, accessible money transfers - clearly something missing right now in this world

The reason it isn't free is that there are loads of anti-money laundering laws that require paperwork on both ends. Sure Cryptos avoid this problem, but just means it'll get regulated or banned.

> For most purposes, blockchain without proof of work is just a glorified git repository

Could you expand on that?

> and I'm pretty sure that not even the most law-abiding citizens want all their transactions to be public.

I believe some blockchain provide anonymous transactions (based on zero-knowledge proofs for instance).

I believe WeChat allows anyone to send and receive money, make payments etc, and at huge stale. No idea how implemented, but no blockchain nonsense.

No, Bitcoin allows anyone to send and receive money. WeChat allows some people to send and receive money.

> Is there a reason this is tied to the blockchain?

Yes: so that Facebook can do as it wishes and not have to follow government financial regulation.

> low-cost, fast, reliable, accessible money transfers

Yes, this could help us to faster get rid of ads as a monetization model.

I doubt that. The main issue you're trying to solve is, that the current payers of ads, corporations, have much more money available than consumers (the payers of ads in the "microtransactions" concept).

But in any case, that's at most the "next" step. First one is, literally replicate what banks do right now (possibly including minimum transaction fee on small transactions - depends on local banks / regulations) except with non-backwards tech.

If Facebook thought that a global payments network was going to make them more money than advertising, then they would have invested in this ten years ago, and we would now all be heartily sick of FBcoin and all the unexpected consequences it engendered.

check out my comment on this thread, or this article:

https://www.coindesk.com/billion-dollar-returns-the-upside-o...

nobody will fund a technology like Libra, owned by Facebook, in fact they already failed before

the main point is that Bitcoin is decentralized, there are many nodes in China, Iran, etc. that is why it has so much value

You just described Stellar.

> Why a "new currency"?

You need an all digital currency to keep transaction fees cheap, and to speed up transactions especially accross countries.

Just think about it, today's currencies are backed by physical paper. At some point, if A paid B, B should receive the physical paper money for the exchange. This is known as liquidity, and it's the major reason why money transfers over the internet today are expansive and slow.

> Is there a reason this is tied to the blockchain?

Yes, blockchain is key. Look at what all modern currencies in use have in common? They are backed by a very powerful entity, mostly governments with real power (weapon and authority on actual land and people). This isn't a coincidence, whoever controls the currency has huge power, imagine being able to make money as you please and give it to yourself or others.

You can't trust any single party with such power. Governments are the closest thing people can trust today, often because they have no choice, and sometimes because there's ton and ton of scrutiny, checks and guards in place around them.

And still, when currency is physical, it is also slightly harder to make more for yourself without trail.

Now if currency was digital, it be so easy to abuse, so anyone who had single central control could easily cheat everyone else. You'd not just be in control of the currency like the government is, you'd also become in control of the ledger. That means, that single central entity does not only control the digital currency (how much of it and who it gives it too), but it also controls the exchange of it (keeps track of who has how much of it and who transfer it to who else). That's incredible power, they could just seize your money without scrupule for example.

Blockchain is about solving this issue. If the currency and ledger is controlled by a distributed blockchain, then you don't have a single central entity with all this power. Instead the power is distributed to whoever wants to participate in it.

Now this is still an area of research in some way. Proof of work was one way, and it suffers from the fact that compute majority wins, and the compute majority could actually be owned by a single entity (which owns a ton of compute resources making up the majority).

Proof of stake is the new idea, it says that everyone who wants to be a part of controlling the currency and ledger has to put a deposit amount of their own money. If they are found to have cheated or acted wrongly, they never get that money back, otherwise they get it back and a little bonus for their effort.

In this scheme, you could still have a single actor taking full control, but they'd need to have a ton of money, more money then everyone else's combined stake. So it's much harder to do so.

> Is there a reason this would be tied to a company, instead of being run by e.g. a charity?

To some extent, it doesn't matter who starts it, if it ends up being a distributed open source piece of software, that is run by people from all around the world on different machines not all controlled by one entity, then it has become something out of the hand of whoever started it. Charity or Company, neither in my opinion could be trusted with a single central solution, but they can both try to kickstart an open source distributed blockchain ledger and currency, as long as it does in fact distribute control in a way that single or minority can't control it fully.

> I'm sure there are many issues with fraud/reversible transactions/KYC/anti-terrorism/anti-money-laundering that would need to be resolved somehow

This is probably one of the biggest issue currently, in a weird way, trying to solve the problem of no single central authority also makes it difficult for the government of any country to enforce rules and regulations over it.