Brian Kelly: Libra is the "digital dollar," Bitcoin is "digital gold"

20 Jun, 2019
by Will Heasman
Bitcoin
Brian Kelly: Libra is the digital dollar, Bitcoin is digital gold

While the crypto community clashes over whether or not Facebooks forthcoming Libra token is bullish for Bitcoin or not, CNBC’s resident Bitcoin bull, Brian Kelly, argues that there is, in fact, a “huge difference” between the two, calling Libra a digital version of the dollar, and Bitcoin “digital gold.”

Kelly, a frequent contributor to CNBC and CEO of crypto hedge fund BKCM LLC took to CNBC’s Fast Money to chat about Facebooks foray into the cryptocurrency industry. 

Go to school  

Within the segment entitled: "Facebook Goes Full Crypto," Kelly schooled viewers with a ‘crypto class” explaining the fundamentals of Libra and the difference between the new kid in town and ‘OG’ cryptocurrencies such as Bitcoin.

With Libra says Kelly, users exchange their fiat for Libra tokens, which are then utilized for goods and services and are transferable back to fiat.

The main issue here, however, is trust, Kelly highlights the point that with Libra more than a modicum of trust is needed to ensure that Facebook is doing everything it needs to do to protect your interests. No such trust is needed with real cryptocurrencies such as Bitcoin which literally markets itself as a “trustless” for this very reason, negating the need for middlemen and creating a truly peer to peer monetary system.

“This is about that trusted third party and, to me, that’s the revolution of crypto, is that it is peer-to-peer. You disintermediate financial services,” Kelly said. “So, when you talk about the differences between this and something like bitcoin, bitcoin is trustless. You don’t need to believe that anybody’s going to check that ledger; you can do it yourself.”

Spot the difference

Kelly continued to note the key differences between Libra and Bitcoin, suggesting that Libra is more like a stablecoin in essence:

“This is really the main difference: what Libra is doing is creating a digital version of the U.S. dollar, yen, euro. It’s like a stablecoin, but you still have all the characteristics of a fiat currency.

Bitcoin is ... digital gold. And, in my opinion, it’s probably a lot better than gold, but there is no trusted third party involved, and that’s a huge difference.”

Bullish for crypto? 

However, Kelly stresses that this isn’t meant to disparage Libra, but rather differentiate between the token and bitcoin.

In fact, Kelly dubs Libra “The next iteration” of platforms such as PayPal’s Venmo, adding that it’ll encourage consumers into the cryptocurrency market:

“This is a huge step forward …This validates the technology and gets people involved. To me, it’s like the AOL moment: AOL got you online, Libra’s going to get you into crypto.”

What do you think? Is Libra good for crypto, or will it harm the industry in the long term? Let us know your thoughts in the comments!

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