Facebook on Tuesday announced a digital wallet, Calibra, to support Libra, and the Libra Association, as reported, revealed details and partners involved in the launch of the new digital currency.
Libra, which will be backed by “a reserve of real assets,” will collaborate with regulators, and has the support of MasterCard, Visa, Paypal, Booking Holdings, Uber, Lyft, and Spotify, among others.
Libra, which will be set up by the Libra Association and its corporate members, and aims to launch in 2020, positions itself as a responsible cryptocurrency in contrast to the renegades who abhor regulation, although the social network doesn’t articulate it in precisely this way. Not that there aren’t plenty of scammers in the crypto world.
“Unlike the majority of cryptocurrencies, Libra is fully backed by a reserve of real assets,” the association wrote in its own announcement. “A basket of currencies and assets will be held in the Libra Reserve for every Libra that is created, building trust in its intrinsic value.”
Booking Holdings clearly sees Libra as a contributor to solving a big problem: the fragmented and ever-growing numbers of disparate payment systems, including WeChat, Alipay, GrabPay, and tons of others, in emerging markets. It’s unlikely that one new currency would be a panacea for such a complex issue as payments, but it could help spur new solutions.
“Financial inclusion and economic empowerment are complex issues, but this is a great initiative, bringing together a lot of trusted global companies to help solve a global need,” said Booking Holdings spokeswoman Leslie Cafferty.
The company’s Booking.com unit helped create the world’s largest accommodations site by using a pay-at-the-hotel business model. But Booking Holdings, especially its Singapore-based Agoda brand, has been increasingly using the merchant model, where the online travel agency processes the payments.
In 2018 Booking Holdings grew its merchant revenue 40 percent to nearly $3 billion.
Especially as Booking Holdings digs deeper into alternative accommodations it becomes more important for the company to develop alternative payment systems because many vacation rental owners aren’t set up to accept credit cards themselves.
The move by Booking to get involved with the Facebook digital currency effort fits in well with its strategic push to develop or use alternative payment systems.
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