Celo announces a new crypto alliance as it takes on Libra

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Celo announces a new crypto alliance as it takes on Libra

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It aims to launch its mainnet in April. Celo has now announced that it has signed up 50 founding members for its new initiative, dubbed the Alliance for Prosperity, per Medium.

The alliance was formed to ensure that Celo delivers on its mission to help enhance financial inclusion and to further the adoption of its use cases. As such, all members have committed to integrating with the platform and enabling some of its use cases. They will also provide ‘Prosperity Gifts,’ like financial grants, to developers proposing Celo products.

Members of the alliance include Andreessen Horowitz, Coinbase, and Bison Trails, but their participation could lead to a conflict of interest with Libra. Some of these members are also part of Facebook’s Libra Association, which was established last year to help govern its proposed cryptocurrency, dubbed Libra.

This could potentially lead to a conflict of interest between members, as they will likely only be able to truly promote and endorse one of the ventures. However, it also allows them to hedge their bets, since not all crypto projects will be successful in the long term.

The Libra Association has already lost some of its key members, including Mastercard and Visa, and we might see some of these members jump ship to other projects like Celo in the future — especially since Celo members don’t have to contribute a hefty financial investment to be part of the association, unlike Libra’s members.

Celo aims to make a number of financial services more efficient with its platform, but there are still hurdles it needs to overcome.

Developers will be able to build a variety of services on Celo’s platform — but interest is still relatively low. The Celo Dollar is meant to help make remittances cheaper and more efficient, for example, but it could also be used for other use cases including microlending and humanitarian aid.

The platform’s success will largely depend on how many companies use it to build applications — and only 130 teams have expressed interest in building on the Celo platform so far, compared with the 1,500 that said the same for Libra four months before it was even revealed, which could hamper the platform’s initial growth.

Other similar projects have been plagued by regulatory concerns, and Celo should work on easing such worries early on. Unlike Libra, which will reportedly be backed by a basket of fiat currencies, including the US dollar, Celo is backed by other cryptocurrencies.

Not being pegged to a fiat currency could make Celo more volatile, which may make using the coin more risky. Additionally, Celo will likely come under the same scrutiny as Libra in terms of anti-money laundering concerns and countering terrorist finance abilities, so it should work on finding solutions for these worries as soon as possible, or it might risk losing members — much like we’ve seen happen to Libra.

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