Despite all the opposition from international financial and political officials, it looks like not everyone is against Libra. Facebook went on to reveal more details about the cryptocurrency that’s still under development. This included unveiling the currencies that will be used to back it.
The company wrote a letter to German politician Fabio De Masi stating that Libra will be backed by the US dollar reserve. This will be alongside the euro, the Japanese yen, British pound and Singapore dollar. The move by these traditional currencies is designed to solve the problem of price volatility that has for years plagued the already existing crypto coins including bitcoin.
However, this has raised the question of where the Chinese yuan stands as it is absent from the list. This is considering the yuan stands as the currency of the world’s second-largest economy. But instead of focusing on China, it has been revealed as an action by Facebook to separate themselves.
Leaving the yuan would most probably be seen to help appease the US regulators who as of now are really critical of the Chinese economy and trade policy. Trade wars!
But as Facebook can now get some breathing space, let’s not forget that the likes of France and Germany are still on Zuckerberg’s neck. They did promise to block the currency as it poses a threat to “monetary sovereignty”.
Similarly, politicians in the UK have expressed their own share of concerns. They have claimed that Libra represents Facebook’s latest attempt to “turn itself into its own country”. Yet even though its subsidiary Calibra is backed by a group of finance and tech big wigs, it still doesn’t seem to convince enough. In fact, one may say that these companies raise even more suspicion.
Well, the drama still continues and probably will till the end of time. But we’ll be hear to cover it all.