What's going on?

After six months of anticipation, Facebook finally spilled the beans on its forthcoming Libra �cryptocurrency� on Tuesday.

What does this mean?

Facebook, inspired by the success of Chinese giants like WeChat, wants to create a global financial network ��but with its own brand-new currency. Libra is scheduled for launch in 2020 via a new subsidiary and app called Calibra, and Facebook is partnering with over two dozen companies on the project � including payments giants Visa and Mastercard. Keep your friends close…

The group will together be responsible for governing Libra. But the very presence of a governing association goes against the independent blockchain concept central to cryptocurrencies � which may be why Facebook�s founder has been careful to avoid any use of the word.

Why should I care?

For you personally: Brave new bitcoin.

Libra is billed as allowing the world�s 1.7 billion unbanked, two-thirds of whom own a mobile phone, to make cheap instant payments. But Libra could also help cost-swamped Facebook make more money from its apps� two billion daily users, rewarding them for watching ads and buying directly from partners like Booking.com � while Facebook takes a lucrative cut. Access to transaction data could also prove juicy. But given Facebook�s record on privacy, will anyone trust it with their digital money second time around?

The bigger picture: A new Federal Reserve?

When the US�s central bank was set up a century ago, many worried that effective control of the world�s monetary policy was being ceded to a private organization. There are similar concerns with Libra � only this time, nobody�s getting to vote on it (tweet this). Facebook says that it�ll keep Libra�s value steady by backing it with billions in real-world currencies. But there�s a risk that this could eventually involve it snapping up most of the world�s foreign exchange trading, and perhaps some government bonds too � with the heightened competition for �safe� investments potentially pushing interest rates even lower. Regulators will be watching closely.