07 October 2019, 21:10
2 min reading
Tech giants are actively adopting blockchain technology for their enterprise-level real use cases. However, the cryptocurrency sector is also seeing a glimpse of significant adoption as Twitter, Samsung, Facebook, and other companies are actively working on their own projects. For now, Facebook’s Libra, a global cross-border cryptocurrency solution, became one of the most significant and
Tech giants are actively adopting blockchain technology for their enterprise-level real use cases. However, the cryptocurrency sector is also seeing a glimpse of significant adoption as Twitter, Samsung, Facebook, and other companies are actively working on their own projects.
For now, Facebook’s Libra, a global cross-border cryptocurrency solution, became one of the most significant and like-wise controversial projects in the sector this year. As the tech giant holds not only one of the greatest social platforms in the world, Zuckerberg owns WhatsApp and Instagram as well.
Frightened that the company might develop a digital asset adopted by more than 2.3 billion of its users, both political and financial entities tried to pressure Facebook into submission. With heavy regulatory pressure, that resulted in PayPal removing its support for the project, the fate of Libra seems more uncertain than ever as it is supposed to launch in June 2020.
On the other hand, WhatsApp’s competitor Telegram is set to successfully launch its own cryptocurrency solution, with the help of crypto custodian Anchorage who will support the platforms ‘Gram’ asset. Interestingly enough, Anchorage is also one of the 28 founding members of the Libra Association.
Furthermore, the institutional-level crypto custodian is supporting Telegram’s blockchain network (Telegram Open Network) by allowing organizations and institutional investors to actively develop their services and products on the network. The blockchain network’s native asset is named Gram and is set to be released next month.
With the help of two private investment rounds, Telegram managed to sell $1.7 billion worth of Gram tokens during 2018. By doing so, the social platform successfully attracted several institutional investors who stabilized the fate of the project, despite the pressure from regulatory bodies that almost lead to the project’s public ICO not being established.
While both Telegram and Facebook have the same goal and a similar product, the co-founder and president of Anchorage, Diogo Monica, believes that Gram and Libra are not competitors, but complements.
He compared the two projects to several fiat currencies, such as the dollar, euro, and British pound, who ‘happily coexist in the same financial system’. Furthermore, Diogo stated that the cryptocurrency sector is not a ‘winner takes it all’ environment and that the sector represents a vibrant ecosystem filled with projects that offer different features and use cases, noting that the trend is set to continue.
A part of the crypto community agrees with the sentiment, as the fundamentals of both projects show major differences. For example, Facebook took a centralized approach compared to Telegram’s focus on encryption, security, and decentralization. Additionally, Libra was introduced publicly early-on as a stablecoin asset pegged to fiat currencies, that enjoys the support of several established companies.
Telegram’s gram, on the other hand, was developed secretly and faced with regulatory pressure as soon as it was announced. However, this does not come as a surprise as the Russian-based platform supports an anti-establishment sentiment, and is no stranger to civil unrest and government opposition.
For example, protestors in Hong Kong used Telegram as one of their main lines of communication, due to the application’s encryption layer which allowed them to hide their identities from the government.
Anchorage’s Diogo has previously mentioned these differences, stating that Telegram’s Gram and Facebook’s Libra use ‘completely different underlying technologies’, adding that the projects target different use cases. While Libra plans to bring financial instruments to everyone in the world, thus solving global financial inclusion, the Gram token will be used for making in-app transactions for an already established user base.
Nevertheless, Diogo might be right in saying that there is no rivalry between the Gram and Libra as Facebook’s project might not even launch, despite actively working with regulatory bodies and having the support of 28 significant founding members such as Visa, Mastercard, PayPal, Coinbase, and others.