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Why Didn’t Facebook Just Build Libra on Ethereum?
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Why Didn’t Facebook Just Build Libra on Ethereum?

by Raphael PutongJuly 18, 2019

People may wonder why Facebook has chosen to build their Libra blockchain network from scratch, rather than building on an existing giant like EthereumEOS, or even – as was rumored – Stellar. The answer is simple and sophisticated at the same time, depending on how deep into it you want to look.

Facebook Wanted Better Scaling and More Control Than Ethereum Offers

On the surface, it’s simple enough: Facebook wants more control than using an existing decentralized network like Ethereum would allow, necessarily wanting to have the ability to reverse transactions in accordance with financial regulations.

This is an important distinction for the product that Facebook’s working on, as opposed to cryptocurrencies. Even Ripple (XRP) doesn’t offer this type of control to its network participants, but Facebook was recently told that it’s “critical” they find some way to handle undesirable transactions.

That’s the first reason.

facebook cryptocurrency libra
Facebook wants central authorities to have significant control over the Libra network. | Source: REUTERS / Dado Ruvic

The next reason is that Ethereum may not have the scale that Facebook, even as a brand new crypto project, will require.

Ethereum’s scaling has become such a problem that Vitalik Buterin recently floated the idea of utilizing Bitcoin Cash’s ample space.


About The Author
Raphael Putong