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Facebook Reconsiders Libra Plans Due To Resistance From Regulators

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Facebook is reportedly currently reconsidering its plans for its  Libra cryptocurrency. Reports say that the rethink is due to resistance from regulators.

 

The social media giant is now considering a currency system with digital versions of established currencies like the United States Dollar and the Euro, according to Bloomberg.

 

Facebook also claims that despite the backlash, the Libra Association which was created with the objective of creating its own cryptocurrency will continue its work. It will now take part in the new plan to recreate digital versions of already established currencies.

 

In the words of the head of Policy and Communications at the Libra Association, Dante Disparte:

 

“The Libra Association has not altered its goal of building a regulatory compliant global payment network, and the basic design principles that support that goal have not been changed nor has the potential for this network to foster future innovation.”

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Several reports say that the social media giants will launch the digital currency later in 2020. This, several months after it initially planned to launch the Libra cryptocurrency. Facebook had said in June 2019 that it was launching the Libra digital currency, with the goal of making payments easier and cheaper.

“Cryptocurrencies threaten monetary sovereignty of governments”

The Libra Association includes partners like Lyft, Spotify, and Shopify. However, several other high-profile members like Visa left after criticism from authorities over the idea. Mastercard, PayPal, and Stripe, also left the Libra Association at the time.

 

At its launch, Libra Association had 27 other companies and nonprofits, the group is based in Zurich, Switzerland. In October 2019, the world’s biggest economies warned that cryptocurrencies like Libra pose a risk to the global financial system.

 

France also said cryptocurrencies threatens the “monetary sovereignty” of governments. Some others warn that criminals can exploit cryptocurrencies for money laundering and other illegal activities.

 

We are yet to see the authorities react to Facebook’s new strategy.

 

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