In the world of cryptocurrencies, big promises, names, and numbers aren't uncommon; at every corner, you'll find well-funded projects that aim to change the very core of the world's financial system.

But Facebook's new blockchain project, Libra, dwarfs even the most ambitious of its predecessors. The sheer power of the names involved with Libra, as well as the project's scope, are serious business. Its initiator is the world's largest social network.

Its partners include some of the biggest finance, tech, crypto and retail companies in the world, and it will be integrated in some of the world's most popular apps. 

In the past week, I've had several meetings with Facebook executives and experts involved with the project, and I've read over a dozen documents describing various aspects of it. Libra is still in its early stage, and many details are unknown; some will likely remain unknown until the first half of 2020, when the project is due to officially launch.

But here's a comprehensive overview of what we do know right now. With Libra, Facebook is reviving its old dream of building a payment network; the company tried in 2015 with Messenger Payments, but the feature, which let users send and receive money, never quite caught on. 

SEE ALSO: Facebook announces Libra cryptocurrency with a massive list of partners Now, it's 2019, and times are very different. Cryptocurrencies such as Bitcoin have shown that it's possible to build a decentralized peer-to-peer digital cash and a payment network that's secure, and that anyone can use.

Ethereum used the same underlying technology, the blockchain, to create a platform for decentralized apps. And stablecoins, such as DAI, USDC and TUSD, have shown that it's possible to create a cryptocurrency whose value isn't as volatile as the value of bitcoins and ether. 

With all those pieces in place, Facebook is trying money transfer out once more, but this time, armed with a system that takes some of the best traits of the cryptocurrencies available today, and a small army of partners to provide support and drive adoption. 

A short history of Facebook's blockchain project

Libra is Facebook's project, but the social network won't be its only custodian.IMAGE: LIBRA ASSOCIATION/BOB AL-GREENE/MASHABLE COMPOSITE

January 2018 was perhaps the first serious sign that Facebook was up to something in the blockchain space. In a seemingly out-of-character move, CEO Mark Zuckerberg spoke about the power of decentralized networks. 

"Encryption and cryptocurrency (...) take power from centralized systems and put it back into people's hands," he said. "But they come with the risk of being harder to control.

I'm interested to go deeper and study the positive and negative aspects of these technologies, and how best to use them in our services."In May 2018, things got serious. Facebook reassigned David Marcus, previously the head of Messenger, to lead an internal blockchain project.

This spurred numerous reports about the size and the scope of Facebook's blockchain endeavor, though Marcus, and — subsequently — Facebook, insisted that the team is small. "I'm setting up a small group to explore how to best leverage Blockchain across Facebook, starting from scratch," Marcus said at the time. 

After that, the rumors intensified; and details on Project Libra, as it was reportedly internally called, began taking shape (the Libra moniker mentioned in those reports remained, but "GlobalCoin" appears to have been abandoned). Facebook kept adding people to its "small" blockchain team; in February 2019, the company acqui-hired the main people behind crypto startup Chainspace.

Official word was that Facebook's blockchain team was "exploring many different applications," but even then, the plans for Libra — which turned out to be a not-so-small project after all — must have been well underway.

Three Libras, and one Calibra

Now that Libra has been officially announced, let's clear some inevitable confusion. Libra is several things: the Libra Blockchain, the Libra currency and the Libra Association. 

The Libra Association is the Geneva, Switzerland-based not-for-profit organization that governs Libra, and is run by Founding Members, which include Facebook — but the social network does not have special preference in the decision making progress. 

The Libra Blockchain is a new type of blockchain, primarily designed to support the Libra cryptocurrency, but one that also allows anyone to build smart contracts on top of it, similarly to Ethereum.

The Libra coin is a special type of cryptocurrency, a stablecoin, meaning its value should not change much compared to some stable real world asset, like the U.S. dollar. It's backed by actual fiat money and equivalents, held by custodians chosen by the Libra association.  Finally, Calibra is a cryptocurrency wallet that lets users send and receive Libra coins. Unlike the three projects above, Calibra is built and maintained by Facebook, and it will be integrated into WhatsApp and Messenger. 

A strong list of partners, with some notable omissions

Facebook and its 2.38 billion monthly active users, combined with WhatsApp's 1.5 billion users, should provide a good starter user base for Libra. But history has shown that sometimes, even a giant like Facebook isn't enough to drive user adoption.

Hence, Facebook has partnered with numerous corporations from finance and retail, as well as some not-for-profits, in order to drive user adoption and generally makes Libra less of a Facebook project and more of a global one.  

Here's the full list of the Libra Association's Founding Members at launch: Mastercard, PayPal, PayU, Stripe, Visa, Booking Holdings, eBay, Facebook, Farfetch, Lyft, Mercado Pago, Spotify, Uber, Iliad, Vodafone, Anchorage, Bison Trails, Coinbase, Xapo, Andreessen Horowitz, Breakthrough Initiatives, Ribbit Capital, Thrive Capital, Union Square Ventures, Creative Destruction Lab, Kiva, Mercy Corps and Women's World Banking. 

The list is worth sifting through. The payments side of the equation is strong, with Mastercard, Visa and PayPal onboard — though not one big bank. On the retail/tech side, the participation of Uber and Spotify will definitely drive adoption, and digital e-commerce giant eBay is here as well.

Remember the rumors about eBay accepting cryptocurrency? Well, it's happening. It's worth noting that Amazon isn't on board right now, nor are Apple, Microsoft, or Google. It's also notable that — intentionally or not — there are few big partners on the blockchain side.

Yes, Coinbase, as one of the world's biggest cryptocurrency exchanges, is here, but there's no mention of major blockchain companies and foundations such as the Ethereum Foundation, EOS, Ripple, and others.I've asked Tomer Barel, the VP Operations for Calibra, about this, and he told me that the Libra Association is open to accepting more members in the future, and that there are no direct obstacles to one of the above joining in, though he did note that Libra is an entirely new blockchain product and as such different (though, to some extent, interoperable) from other blockchain projects. 

A blockchain that's fast, powerful, but not permission-less (yet)

For Libra, the transition from permissioned to permissionless might take a while.

IMAGE: LIBRA ASSOCIATION

The Libra blockchain is a new blockchain, based on (heavily modified, Barel told me) HotStuffprotocol, launched a few months ago by VmWare.

It will take numerous experts sifting through its whitepaper and code (which will be released today and which I have not seen) until we can get an objective idea of its strengths and weaknesses compared to other blockchain projects.

But here are a few key takeaways. Libra will start out as a permissioned blockchain, and slowly transition to a permissionless blockchain. This is very important: Bitcoin and Ethereum are permissionless networks, meaning anyone can join in and run a node, thus becoming a part of the blockchain's infrastructure.

But on Libra, initially, only a small list of approved companies and organizations will be able to run a node. In simple terms, this means that it will be easier to make Libra scalable (Barel told me the goal is to have thousands of transactions per second), but it won't exactly be a fully decentralized project at launch. 

From Libra's whitepaper:  "The Libra Blockchain will be decentralized, consisting of a collection of validators that work together to process transactions and maintain the state of the blockchain. (...) Initially, the association (and validators) will consist of a geographically distributed and diverse set of Founding Members.

These members are organizations chosen according to objective participation criteria, including that they have a stake in bootstrapping the Libra ecosystem and investing resources toward its success."

The timeline for turning Libra into a permissionless blockchain is quite generous: The association plans to start the process "within five years" of Libra's launch. Libra will be a smart contract platform

Like Ethereum, Libra will allow third party developers to build decentralized applications on top of its blockchain. However, unlike Ethereum — which is an all-purpose decentralized smart contract platform — Libra will have a strong bias towards financial applications. 

Libra comes with a new programming language called MoveMove is a new language, meaning developers will have to adapt to a new programming environment.

Facebook says it's designed with "safety and security as the highest priorities."Libra is an advanced blockchainIn the world of blockchain-type technologies, it's hard to find two experts who agree on what type of blockchain is the best.

But one thing is certain: Libra is not some obsolete piece of tech. It uses several advanced techniques and solutions, such as using Merkle trees to store the entire ledger history, and a Byzantine fault-tolerant consensus model (meaning it's resistant to up to one third of nodes in the network being faulty or dishonest) similar to modern proposals such as Casper and Tendermint. 

Fully evaluating the advantages and disadvantages of Libra's technical solutions is both beyond the scope of this text and the abilities of its writer, but, again, I'm sure experts will have their say in the next weeks and months. Libra is not proof-of-work

Unlike Bitcoin, which at its current state requires immense computational power to run, Libra does not use a proof-of-work consensus algorithm. This means that running Libra won't waste tremendous amounts of energy. 

Libra is pseudonymousJust like Bitcoin and Ethereum, Libra does not link accounts on the network to a real-world identity. Libra is open sourceEveryone will be able to peer inside Libra's code.

A non-volatile cryptocoin

IMAGE: LIBRA ASSOCIATION

The Libra currency is a type of stablecoin, but it's different from most stablecoins currently available on the market. Instead of closely following the value of a real world asset, like the US dollar, Libra will have its own value. However, it will be backed by a basket of "low-volatility" assets to ensure its stability. 

Even though it's built to be stable, the value of Libra will fluctuate. If you purchase a $100 worth of Libra today, it might be worth a slightly different amount in the future.

According to a document Facebook sent me, "the reserve assets are being chosen to minimize volatility, so holders of Libra can trust the currency’s ability to preserve value over time.

"Sending and receiving Libra will be very cheap (or even non-existent), though details on how cheap are unclear. So how will the entities holding Libra reserve assets make money? One word: interest.

According to a document Facebook sent me, "Interest on the reserve assets will be used to cover the costs of the system, ensure low transaction fees, pay dividends to investors who provided capital to jumpstart the ecosystem and support further growth and adoption." Note that Libra users will not receive a return from the reserve. 

The Libra Association will be Libra's caretaker, and the only entity that can burn or mint Libra currency. And it will be done in reaction to market demand. With increased demand for Libra, more Libra will be minted and the supply will increase — and vice versa. 

The wallet that's open to everyone (who provides an ID)

For most users, all that Libra is will largely boil down to Calibra, the Facebook-built wallet that lets you send and receive Libra currency. It will be integrated into WhatsApp and Messenger, allowing users of those apps to easily sign up, top up their wallets with funds, and send, receive and pay with Libra (with "small" transaction fees), all from within the apps.

Calibra will also be available as a standalone app for iOS and Android. Signing up for Calibra will require KYC (know your customer) verification, meaning that users will have to upload some sort of government-issued ID before they can start using the service.

Kevin Weil, the VP of Product for Calibra told me the onboarding process will be as simple as possible, "almost chat-like." Topping up funds should be as easy as typing in credit card info. For the unbanked, in some areas it will be possible to go to physical locations where they will be able to top up by handing over cash. 

As far as privacy goes, Facebook claims that Calibra will "not share account information or financial data with Facebook, or any third party without customer consent." 



An early look at Facebook's Calibra cryptocurrency wallet.IMAGE: LIBRA ASSOCIATION

On the security front, Calibra will have built-in fraud protection, password recovery option, and multi-factor authentication. One Calibra feature that cryptocurrency wallets typically don't have will be 24/7 customer support. 

Important: due to the open nature of Libra, Calibra will not be the only Libra wallet you can use. In fact, it should be entirely possible (Weil confirmed this to me) to sign up for Calibra, top it up with some money, then move the Libras you've received somewhere using a third-party wallet that's completely unrelated to Calibra and outside of Facebook's ecosystem. 

More information on Calibra is available at calibra.com; you can also sign up to receive a notification when the wallet becomes available.

Rules and regulations

Creating new forms of money and letting billions of users send it around, globally, is not as simple as building a platform — there's also rules and regulations to consider, and these vary by jurisdiction. 

I've asked Weil about the potential issues here, and he told me that Calibra will be a fully regulated entity, and that Facebook is already talking to regulators around the world, and is in the process of applying for licenses to make Calibra fully compliant with the law.

Even though the entire project is envisioned as a global one, Weil told me that Calibra will "only operate where it’s legally allowed." 

When does Facebook Libra launch?

The Libra blockchain and coin, as well as Facebook's Calibra digital wallet, are still quite far from being ready for public use. Facebook says it aims for a launch in the first half of 2020.

However, the "early-stage code" for the Libra Blockchain will be open sourced today, and Libra says it welcomes the community's feedback about the project.  As far as Calibra goes, Kevin Weil told me that Facebook's still got a "ton of work to do" before Calibra can go public. 

What does it all mean?

There's no doubt about it: Libra is one of the most ambitious cryptocurrency projects ever conceived. It's comprised of a blockchain, a smart contract platform, a low-volatility cryptocurrency and a wallet that will be integrated in some of the most-used apps today. 

Many questions remain: Facebook hasn't exactly had a stellar privacy track record in the past couple of years. The company appears to have done a lot to make Libra an open, global, joint effort.

Even so, the public as well as regulators will surely want to know whether Libra and Calibra open up new avenues for misuse of user data. There's also the question of technical execution. Libra and Calibra are in pretty early stages of development, and there may be unforeseen obstacles ahead. 

Still, Libra is a massive project, backed by a long list of heavy hitters in the payments and online retail space. Companies like PayPal, eBay, Mastercard and Visa have so far been reluctant to openly embrace cryptocurrencies.

This changes today, and it's a big deal — both for the companies involved, and for cryptocurrencies in general.