When Facebook suddenly dropped the whitepaper for the Libra network in June, the world’s regulatory spheres erupted in a flurry of concern–how would this work? What purpose would Libra serve? Who would control it?
At the same time, a number of entrepreneurs around the globe saw something different: a massive opportunity. If launched, the Libra network could serve as the underlying fabric for a number of unprecedented global financial applications.
The entrepreneurs that have formed Libra Camp are among them. The company describes itself as “a virtual bootcamp for startups building apps on the Libra blockchain,” providing startups mentorship and opportunities to gain access to investor capital.
Recently, Finance Magnates spoke with two of Libra Camp’s co-founders, Tomer Weiss and Yonatan Ben Shimon, about how Libra Camp is working to build the Libra ecosystem from the outside in, and what the plan is if Libra doesn’t launch after all.
Yonatan explained that the underlying philosophy of Libra Camp is built on digital accelerators’ biggest and most under-used power: the “network effect”. Basically, this is the idea that each user adds value to the other users on the network. He said that this is the best way for a platform to grow and accomplish new things “[without] the platform having to do anything itself.”
“The talent right now in the world is global: someone can be in India, can be in Pakistan; the next Mark Zuckerberg can come from anywhere. We came up with a model where we are getting all of these startups to be part of this club so that they have the incentive to help each other.”
“Another important thing is that this is the first time in history when finance is becoming technology,” he said. “The internet was [invented] basically as a communication protocol, so the best applications on top of it were communication applications, like Facebook and Google. Libra is a financial protocol–the biggest applications on top of it will be fintech startups.”
“This is the first time that fintech startups really have the chance to succeed,” he continued. “Until now, fintech startups were built on top of a very limited infrastructure: on top of a bank, on top of Visa or Mastercard’s infrastructure.”
“..Overall, there are already developers experimenting with the Libra testnet, including dozens of teams that applied to the Libracamp program based in Israel, which isn’t officially affiliated with Facebook…”@La__Cuen @coindeskhttps://t.co/i0YRbPS41t
As a blockchain network, Libra presents a number of opportunities that these other kinds of infrastructures are lacking. Weiss added that there were several reasons behind the teams’ decision to build this ecosystem on top of Libra as opposed to another cryptocurrency network.
“First of all, because Libra is backed…by a number of serious organizations that are joining for the first time into the blockchain ecosystem. These organizations are big enterprises [that have] products that serve people on a daily basis.”
Additionally, “Facebook has two billion users. So, it’s a huge opportunity for mass adoption: if they launch it through [all of] their platforms, it will be highly accessible.” Weiss explained that this could be the “gateway” to crypto assets and programmable money that the industry has been waiting for.
Because of the potential scale of the Libra ecosystem, Weiss said that a growing number of entrepreneurs have begun planning around and engaging with the Libra ecosystem: “we see more and more communities building around Libra and educating developers about how Libra can [facilitate] financial inclusion and public applications.”
The #Libra Association is today announcing plans for a simple global currency and financial infrastructure. Find out more https://t.co/VPS7LllcNn #blockchain #cryptocurrency pic.twitter.com/mdHymhsrcH
Weiss compared the dawn of Libra to the early days of the iPhone: “it’s a similar opportunity to what happened with iOS in 2009,’ he said. “Right now, because we already know that Facebook has very popular platforms…building financial applications on top of [Libra] is a little bit similar to transforming a website into a mobile application [in 2009.]”
Shimon said that Libra Camp has spoken with Calibra as well as several of the project’s backers, including Mercy Corps, Bison Trails, and PayPal; Mercy Corps and Bison Trails have also joined Libra Camp’s pool of “judges,” or “mentors”.
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What does this mean on a practical level? Essentially, the process of choosing the projects that will receive funding has been gamified.
“The idea is to get a lot of smart people and to create a curation system that will give points to the best startups based on performance,” Shimon explained. “The way this system is being built is that every startup that already has a product and already has users uploads their Libra progress”–a video and several other metrics each week–”into our system,” which is a staging environment located at LibraMove.com. (The site was not yet live at press time.)
LibraCamp evaluates projects from several angles before considering allowing them into the system to be voted on. “What interests us is how mature the project is,” Weiss said, adding that “when we’re talking about maturity, what [we mean] is the level of the product…how many users the projects has, and how long it has existed.”
“We also look at whether they have income and if they have investments,” he said. “But we also look at diversity…we want teams from many different nations, including developing countries; so we can be [more forgiving] with projects that come from [places like] Nigeria and Indonesia.”
Theme is also important: “we prefer financial inclusion-related projects.”
Once a startup has onboarded its product into LibraMove, it can be given ‘“UpVotes” by community members and ‘mentors’ (mentors’ votes are worth 20 points while community members’ are worth eight.) After an eight-week period, “the one that gains the highest amount of points gets funded by a pool of investors.”
Shimon said that LibraCamp is choosey when it comes to which kinds of investors are invited to take part in the project. “The investors are a very component, because if they are short-term thinkers, then the startup will not be able to fulfill its potential,” he explained. Of course, “we think that money is important to a startup as a fuel for its dream, but it must [come from] smart people, people that think long-term.”
Shimon also said that Libra Camp and Calibra are in talks to find a way to interact in which Calibra would be “further involved, more than just becoming [a] judge.”
“They want to empower the development community,” he said. “Regarding the relationship, it’s interesting to see that they want someone to fill this [application] role. They basically want to be the infrastructure layer…and they want someone else to think and to build and to be responsible for the applications.
Shimon went on to explain that LibraCamp sees itself “like Red Hat for Linux or ConsenSys for Ethereum.”
“We asked them: ‘what are the [kinds of] applications that you want to be built?’ And they said, told us, ‘we want the community to come up with the best applications, and we don’t want to be very involved in directing [this].”
But what will happen if Libra doesn’t launch?
Weiss said that he believes that Facebook’s decision to include the fact that Libra may never launch in their latest quarterly report has to do with legal liability: “public companies have to inform investors about risks.”
Of course, “there is a chance that it may never [be launched],” Weiss said. But at the same time, he believes that the media cycle that followed the statement failed to acknowledge the possibility that Facebook was simply doing its own due diligence: “the media kind of played with it and made headlines from it.”
But Weiss said that Libra Camp will continue to move forward whether or not Facebook moves ahead with th crypto project from whence its name came. “Basically, the value of what we are doing is financial inclusion. We want to promote financial inclusion…for unbanked people, especially in developing countries,” he said. “This is our mission. And right now, we believe that Libra, in the next two or three years, [will give us] the highest chance to make [our mission] mainstream.”
“If they cancel the project (which I think won’t happen), then of course, we will continue and find another network that we will keep working on.”
Shimon added that he believes that if Facebook isn’t able to launch Libra, it will only be a matter of time before another major corporation launches a similar product. He referred to the Bank for International Settlements’ June report entitled “Big tech in finance: opportunities and risks.”
“Users will find it [increasingly] easy to get financial services from tech companies because they already get a lot of services from them. So, I think that tech companies will offer financial services; it’s inevitable. I [also] think that corporate money will exist [in the crypto space], whether it’s Libra or not.”
“So, this is a way for user adoption of digital money to go mainstream–because of the adoption they already have. We want to be the facilitator, whether it will be Libra or not.”
This was an excerpt. To hear the rest of Finance Magnates’ interview with Libra Camp, visit us on Soundcloud or Youtube.
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