At every turn in Facebook’s journey toward launching Libra, the social media giant is realizing that governments around the world do not take kindly to attempts to remove some of their power.
The latest setback has emerged from Europe. Bruno Le Maire, the French finance minister, has declared that Libra’s development on “European soil” won’t be allowed until concerns over the monetary sovereignty of governments are addressed. Other governments across the globe have expressed similar concerns.
That Mark Zuckerberg, with all his power and wealth, is flailing in his efforts to launch a mere virtual currency is a demonstration of how mightily superior the eponymously named bitcoin creator Satoshi Nakamoto is.
Without Facebook’s resources and Mark Zuckerberg’s clout and fame, Satoshi Nakamoto birthed bitcoin and it now has a market cap of nearly $200 billion. Libra, on the other hand, faces the prospects of turning out to be a stillbirth.
The difference all comes down to smarts. Here are five takes that demonstrate the Zuck will never be the genius that Satoshi Nakamoto is.
Unlike Zuckerberg, Satoshi didn’t engage in a foolhardy exercise. Knowing the fear governments and established institutions have over potential disruptors to the status quo, the Bitcoin creator had a trick up his sleeve.
In Bitcoin’s early days, Satoshi said:
“Governments are good at cutting off the heads of a centrally controlled networks like Napster, but pure P2P networks like Gnutella and Tor seem to be holding their own.”
To solve the problem, Satoshi went for a decentralized system knowing the dangers of the alternative. But here we are more than a decade later and Mark Zuckerberg is trying to create a centralized global virtual currency, thus taking on not just one government but many and hoping to succeed!
Facebook’s planned virtual currency, if it is ever realized, will undoubtedly rely on the trust model, and this burden will be placed on the social media giant and partner institutions. But for the trust model to work, especially with regards to financial services, it needs the oversight of governments and the backing of reputable financial institutions.
In the case of Facebook with its damaged reputation, the governments that are placing stumbling blocks now look like the good guys.
Satoshi was, however, too smart to get entangled in such a mess. The workaround? A mineable cryptocurrency that does not require intermediaries.
Proof of success? The many copycats and spinoffs that have followed its launch, including Libra!
Unlike Zuckerberg, Satoshi was fully aware that trying to create a currency for the internet would be fought by the forces it would be threatening – be they traditional financial institutions or governments. So what did he do? He devised a mineable cryptocurrency from the ground up that was peer-to-peer-driven and native to the internet.
Meanwhile Zuckerberg, in order to get much-needed approval, has resorted to hiring lobbyists in order to try and convince governments to cede some of their power to him. Your guess is as good as mine as to what works better!
Facebook wants to play with the rules already set, unlike Satoshi who invented a brand new space that caught governments off guard. Thus, the rules and regulations governing cryptocurrencies in some parts of the world came into being long after the fact.
For Satoshi, it was an ambush and look where Bitcoin is now. Mark Zuckerberg, meanwhile, is walking straight into the line of fire. It is hard to tell whether stupidity outweighs arrogance in this case or vice versa.
While Facebook has tried hard to disguise how it will make money off Libra, the product is ultimately designed with profit in mind.
Satoshi’s vision, on the other hand, was bigger and for the greater good. This included giving people greater freedom and control over their money while protecting their privacy – all in one go. Geniuses change the world; lesser beings just make money from it.