Rather than a single currency finding its basis in a basket of fiat currencies, the Libra consortium plans to develop several stablecoins, each backed by a different fiat currency. Facebook has been facing constant criticism for is cryptocurrency project Libra since mid last year, when the social media giant announced the project. Libra Association has revised some of the policies regarding the project to satisfy regulators all over the world.
Libra also hopes to issue multi-currency stablecoins.
Earlier, Libra Association had announced that the cryptocurrency would be backed a basket of currencies and other government bonds, but now the Switzerland-based association revealed that they plan to develop several stablecoins, each backed by a different fiat currency. So users can purchase a U.S. Libra coin, a Euro Libra coin, and whatever other currencies and countries join the program. Vice-chairman Dante Disparte said, “the journey since the original white paper was released has really provoked an important conversation around the world about, ‘How do we appropriately regulate digital payments and digital currencies?’
Facebook contributes less than 10% to the project.
The Libra Association is now funded by its members (with less than 10% of the funding coming from Facebook), and has adapted its plans after engaging with key stakeholders globally. 2/8
— David Marcus (@davidmarcus) April 16, 2020
Earlier, the co-founder of Libra David Marcus tweeted the revised policies of the crypto project. He also revealed that Facebook only contributes less than 10% in the project, and it is funded by all members. Since the announcement of the Libra project, Facebook has received massive criticism from regulators all over the world, and the founder and CEO of the social media giant had to testify in front of congress. The association said that their vision has always been for the Libra network is to complement fiat currencies, not compete with them. A key concern that was shared by the regulators was the potential for the multi-currency Libra Coin to interfere with monetary sovereignty and monetary policy if the network reaches a significant scale and a large volume of domestic payments are made in LBR, the association added. And that is why they are planning to include single-currency stablecoins in addition to Libra.
