Facebook confirms plans for Libra cryptocurrency

By Bbalan43 | Bbalan43 | 2 May 2020

Facebook is rethinking plans for its own cryptocurrency - Libra - and plans to launch more stable cryptocurrencies (stablecoins) - each backed by a fiat currency, such as the dollar, the euro or the pound sterling, according to updates from the Libra Association's guide.

The new information confirms the news published in the international press at the beginning of March.

Facebook has rethought its payment system after regulators in Europe and the United States repeatedly announced that they would not allow digital currency to be launched on the market, and several supporters of the project withdrew from the Libra Association.

According to the initial plan, announced by Facebook last summer, Libra was to be a new cryptocurrency, in order to make payment services more accessible and cheaper. Its partners in the Libra Association include Uber, Spotify, Shopify, PayU and Coinbase. Several other important members, such as Visa, Mastercard or Vodafone, withdrew from the Libra project after the idea was criticized by the authorities.

Following the announcement by the social media company last year, several central banks have expressed concern that the pound could become a quasi-sovereign currency in some countries. For example, in some countries with high inflation rates - such as Venezuela, Argentina, Turkey or South Africa - many people would have been willing to abandon the local currency in favor of Libra - controlled by private companies, writes TechCrunch.

"Although our vision has always been for the Libra network to complement fiat currencies, not to compete with them, a key concern that was shared was the potential for Libra to interfere with monetary sovereignty and monetary policy if the network reaches a significant scale and a large volume of domestic payments are made through Libra.

Therefore, the Libra network will include single currencies in addition to ≋LBR - for example, LibraUSD or ≋USD, LibraEUR or ≋EUR, LibraGBP or ≋GBP, LibraSGD or ≋SGD ", explain the representatives of the Libra Association - a group of players in the fields of payments, technology, e-commerce and telecommunications.

Specifically, every time the Libra Association issues a LibraUSD, it will buy and store its equivalent in a bank account (in fiat currency).

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