Home > Civil > Cryptocurrency Scams: Beware As Dozens Of Fake Accounts Claim To Be Selling Libra Currency

Cryptocurrency Scams: Beware As Dozens Of Fake Accounts Claim To Be Selling Libra Currency

Dozens of fake accounts purporting to sell Facebook’s unreleased cryptocurrency, Libra, have cropped up on the platform in a concerted scamming effort.

A report from the Washington Post details dozens of accounts, pages, and groups, across both Facebook and Instagram claiming to be official outlets for buying the currency sometimes at a discount.

The accounts, reports the Post, are often times disguised using Facebook’s official logos and other marketing materials, making them fairly convincing to unsuspecting users.

Targets of the scams are sometimes redirected to third-party sites such as BuyLibraCoins.com which, like the fraudulent Facebook accounts, bare the same official-looking branding and marketing materials of the platform.

The Washington Post notes that other sham websites include the almost indiscernibly similar Calìbra.com, which uses a special character instead of the ‘i’ in Facebook’s official Libra website, Calibra.com.

While Libra scams have popped up on other Platforms, including Twitter and YouTube, some experts have been quick to note the significance of scams inadvertently allowed to proliferate via the company’s home network.

There is a deep irony here in Facebook being used as the platform that could undermine trust in the currency Facebook is trying to build trust in,’ Cornell University economics professor Eswar Prasad told the Washington Post.

As noted by The Verge, other cryptocurrency scams have found their way onto the platform in the past, but those leveraging Libra come with particularly salient timing as lawmakers continue to press the company in a sometimes heated public forum.

Libra has faced skepticism from lawmakers who have continued to prod the company's executives about its plans.

‘I don’t think you should launch Libra at all,’ Rep. Carolyn Maloney, a Democrat from New York told a Facebook executive in one exchange.

Among the major concerns voiced by regulators are privacy, stability, and its potential use in money laundering and terrorism.

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In response to the Washington Post’s report, Facebook offered a brief statement.

‘Facebook removes ads and pages that violate our policies when we become aware of them, and we are constantly working to improve detection of scams on our platforms,’ a company spokesperson told the outlet.


What is Libra?

Libra is the name of the new cryptocurrency Facebook is backing which will launch in 2020, and once in circulation will be used to buy service digitally from a user’s smartphone.

The digital currency will be stored in a digital wallet called Calibra, a standalone app on a user’s smartphone or housed within Facebook-owned services such as WhatsApp and Messenger.

It has been backed by Visa and Mastercard, as well as businesses such as Uber, Spotify and eBay meaning eventually users will be able to use the currency to pay for almost anything from their weekly shopping to an Uber journey or their Spotify subscription.

How does cryptocurrency work?

Cryptocurrencies are entirely digital forms of money which use encryption to carry out transactions securely and in many cases anonymously between two parties, which many argue make it more secure against fraud.

A key benefit of cryptocurrency is also that they are decentralised, meaning that no one entity controls the currency in contrast to how a central bank controls traditional currency.

The currencies are often built on blockchain networks, a type of digital ledger technology where all transactions are publicly verified and recorded and can not be altered – creating a chain of information and improving transparency.

How is Facebook’s different?

The two biggest issues for cryptocurrency so far, Facebook argues, have been scalability and volatility. Bitcoin, for example, has seen its price fluctuate violently in recent years as its price is linked to supply and demand.

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However, Libra is to be backed by a reserve of assets – including linking it to several international currencies – from a number of central banks in order to keep its pricing stable.

The developers have said that launching it through Facebook apps will also make it immediately accessible to more than two billion people globally – the number who use a Facebook app each month.

How can users buy Libra?

When the Calibra wallet for Libra launches, those wishing to use it will need to sign up for an account using a government-issued ID.

Users will then be able to convert their money into Libra and add it to their digital wallet. Once in place, the currency can be used to pay for “everyday transactions, like buying a coffee, buying groceries, or taking public transportation”.

Facebook said initially the new payment system will support peer-to-peer payments between individuals, as well as some other ways to pay for goods and services – for example by scanning a QR code.

The system will eventually be expanded to include integration into point-of-sale systems in stores, which would allow in-store payments that would work in a similar fashion to paying with a debit or credit card or using contactless.

Because it will also be built into WhatsApp and Facebook Messenger, users will also be able to send and receive money between their friends and families just by sending them a message.

This will also work with any businesses they interact with on those platforms, Facebook said.

When will it be available?

Still being finalised in its development, the full system of Libra and its Calibra digital wallet is expected to launch next year.

Source: Dailymail

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