The Facebook project has brought the subject of cryptocurrencies to the forefront. Surely, Bitcoin will benefit from all this global attention to Libra.
Since announcing the launch of Facebook’s cryptocurrency Libra, the entire ecosystem has been wondering if this will be good or bad for Bitcoin or the cryptocurrency market in general. With all the events that have occurred until now, it seems that the influence of Libra will be positive for both.
This conclusion can be reached after seeing people talking about Bitcoin and other cryptocurrencies, since it used to be a subject that only interested connoisseurs and enthusiasts, that is, topics that were only discussed on specialized portals like CryptoWorldJournal. The releases mention Facebook’s cryptocurrency, which continuously brings Bitcoin and other cryptocurrencies to their audiences’ minds, which allows informing about Bitcoin’s existence to a larger percentage of the population.
Petro’s announcement had a similar impact on Venezuela, where most people learned about something called “cryptocurrency.” In regards to Facebook, its scale is much larger because of the platform’s global reach. Thanks to this new wave of diffusion generated by the announcement of Facebook’s cryptocurrency, it can be assured that more people have learned that Bitcoin and other cryptocurrencies exist.
Something interesting about all this is the fact that the world’s governments are promoting all this diffusion. It is hard to predict that the president, the treasury secretary and the director of the federal reserve of the United States will pronounce on Bitcoin and Facebook’s cryptocurrency in the same week. All these announcements are news, so mass media will not the chance to cover and broadcast them.
Not only the United States, but also different countries worldwide including England, France, Germany, Japan and Mexico, inter alia, are talking about cryptocurrencies. Something that both advertising and social networks teach very well is that people talking good or evil about someone is not what really matters but that they do it.
One factor that can be considered positive for Bitcoin is all the intense diffusion about Facebook’s cryptocurrency. Another one, in the case that Libra is actually launched, is that it will surely be another means for capital, and probably other cryptocurrencies, to enter the Bitcoin market.
Since 2018 the offer of cryptocurrencies with a value anchored to a national currency, known as stablecoins, has increased considerably. This type of digital asset contributes to providing the cryptocurrency market with greater liquidity. There might be greater amount of liquidity entering the cryptocurrency market if Libra is launched, since it was planned as a stablecoin, and if it has exchange parity with several cryptocurrencies. Surely, it would prevent the violent price drops that may happen in the cryptocurrency market.
In other words, these are some reasons why Libra could positively affect Bitcoin. Of course, some negative effects cannot be discarded, such as initially promoting inadequate regulation on decentralized cryptocurrencies or significantly displacing Bitcoin as a means of payment. What is evident is that this new wave of attention on cryptocurrencies adds a greater favorable weight rather than possible adverse reactions.
By Willmen Blanco