Seeing both the interest of worldwide governments in digital currencies and the success of Bitcoin this year (positive for 2020), it should come as no surprise that social media platform Facebook has decided to revamp it’s planned cryptocurrency Libra. In a message, the Mark Zuckerberg company stated that Libra would be linked to individual national currencies and overseen by global watchdogs. It is clearly designed in such a manner in order to win regulatory approval.
Global regulators and bank are fearful of course of having to agree Facebook’s 2.5 billion users adopt Libra as their new currency. Whereas the Corona stimulus package distributed among the US population already mentioned digital wallets, the introduction of a true global digital currency via Facebook would be the financial sector’s worst nightmare.
Libra’s governing body, communicating from Geneva, Switzerland, claimed that Libra would be offering various “stablecoins” backed by single currencies.
Some countries, including France and Germany, had said they would seek to block Libra’s launch, while other global bodies scrambled to set out rules for stablecoins.
“We’re retaining the construct of a multi-currency Libra, but it’s fundamentally changed, streamlined and simplified relative to the original one,” said Christian Catalini, head economist at Calibra, Facebook’s digital wallet.
Libra furthermore stated it would hold a reserve of it’s own coins in case of any future “extreme market distress”.
The news comes just as Central banks are accelerating their own research on issuing digital currencies, with China clearly closest to launching one.