By newly introducing synthetic global currency, the Facebook-led Libra project is looking for a better payment system.
David Marcus who is in charge of the Libra project says that the group wants to bring in an effective option for making payments. “We are seeking for a suitable option to represent national currencies for the Libra crypto project says”, Marcus.
The giant social media Facebook is looking forward to a takeoff on its currency and is searching for the best series of stablecoins to go ahead with its plan.
While speaking at a banking seminar lately, Marcus says they are looking for a synthetic unit. It would also be a series of stable coins, which would be a dollar, euro or a sterling pound stablecoin, to be represented in a tokenized digital form. “We can do it differently”, says Marcus.
However, regulators are wary of the sovereignty threat that lingers over this, as it would be a global threat to currencies. It would not be advisable for a private entity to control a global currency, feel bankers and regulators. If such an overwhelming power was given to a private entity, it would lead to money laundering, feel bankers.
The G-20 financial players have written in a statement that illicit finance, money laundering, and consumer protection are key issues to be resolved before a stablecoin can commence its operation.
The Facebook project, however, faces immense criticism from various other sources. CEO Jamie Dimon of JPMorgan states that it is “a neat idea that would not happen”.
Facebook intended to launch Libra in June 2020, but with regulatory hurdles cropping up, the target may not be achieved, fears Marcus. Many key project partners like PayPal, Visa, MasterCard, and Stripe have already left the group, which will further hinder the project takeoff.
The Libra Association chief says that the objective of Libra is to bring a cross-border payment system that is effective.