Over the past year, lawmakers and regulators have been quick to jump into the Facebook Libra media fracas. Facebook introduced its Libra Project a plan for a future digital coin to great fanfare. Within moments regulators and banks were making headline saying that the coin needed to be regulated and many saying no way it would be regulated. Politicians quick to make the news jumped on the bank wagon calling on central bankers to stop the project. The social network and its planned cryptocurrency have endured a withering year as partners bolt from the project, details start to shift and legislators amp up their criticism of the ambitious plans.
The concerns reached a peak in late 2019 when a key US committee laid into CEO Mark Zuckerberg, using Libra as evidence of what they saw as the company’s cavalier attitude toward everything from data breaches to misleading political ads.
Lawmakers and Politicians Against
It seems that everyone wants to get involved in something that doesn’t exist yet. The Libra project was a vision, which had some general ideas and guidelines but did not exist. The project could be changed or adjusted on the members see fit.
This week, Facebook and the Libra project gave out clues that the entire project might be shifting from a digital coin to a payment network accepting many different coins. The Digital Coin under consideration of the project will be under the control the Libra Association, which Facebook co-founded.
The association, which will serve as a monetary authority for the cryptocurrency, says Libra’s purpose is to “empower billions of people,” citing 1.7 billion adults without bank accounts who could use the currency.
The Unbanked
To understand the real power of cryptocurrencies and why Facebook’s initiative could be so game-changing, let’s first understand one of the most significant issues with the world right now. As Business Insider reported back in August 2017, 2 billion people around the globe don’t have a bank account.
A recent report in a major financial publication says that Facebook’s Libra initiative might become a cryptocurrency payment network as opposed to a digital coin on its own blockchain.
The Wall of Opposition
Bloomberg reported “that after the project ran into a wall of opposition, Facebook and the Libra Association, the consortium behind the digital currency, are looking at a revamp, said three people familiar with the matter. They are weighing a recast of Libra as mostly a payments network that could operate with multiple coins, two of the people said.”
The revamped Libra becomes more of a payments network than a single, global cryptocurrency, the average U.S. consumer might not see much difference between Libra and existing payments systems run by PayPal Holdings Inc. or numerous fintech startups that aim to seamlessly move funds around the globe.