Though Facebook’s planned cryptocurrency Libra is not yet released, it has already garnered global attention. So much so, it seems, that other firms in the cryptocurrency space are eager to jump on its popularity and capitalise.
This can be seen with ZenGo, a keyless cryptocurrency wallet which has announced that it supports Libra. Founded in Israel, the firm released their first cryptocurrency wallet earlier this year. It supports a range of currencies, which will include Facebook’s Libra once it’s released. ZenGo announced yesterday that it has released a Libra testnet which allows users to store Libra in their wallets. The wallet allows users to send and receive Libra as well, but it is important to note that the currency holds no value and is for testing purposes.
As per their update, ZenGo is the first consumer-grade wallet to support Libra. If consumers prefer ZenGo’s method of storing funds without the use of a private key, it may provide serious competition to Facebook’s cryptocurrency wallet. Calibra has not been released yet but it is known that it will be a custodial wallet. This means that Facebook will fully control all the funds held in Calibra. ZenGo is the first company to provide a non-custodial option and has the potential to be popular among users.
Nonetheless, Facebook has a user base of more than 2 billion users, and Calibra will be integrated with other popular Facebook subsidiaries such as Messenger and WhatsApp. Facebook’s massive power and monopoly will ensure that most users will by default user Calibra.
It is this popularity that is making many financial regulators nervous about the possible effects of Facebook entering the digital currency industry. The company has already testified before Congress about Libra and what it means even though it announced Libra only two months ago. Facebook has reassured concerned entities that it has full intentions to work with regulators before it releases the currency, but we can be sure that regardless, it will have an industry-shaking impact.