Libra’s Announcement Was the Defining Moment for Cryptocurrencies in 2019
The announcement of Facebook’s long-awaited cryptocurrency shook the highest levels of government and finance to its core, but the Libra association shrank over the course of 2019 as governments around the world reacted in a tense and defensive manner.
Examples of this can be found everywhere. The French government wants Facebook’s cryptocurrency banned in Europe, and just recently, European Central Bank head Christine Lagarde prompted a faster response to cryptocurrency adoption in reaction to Libra’s emergence.
The latest high-level official to weigh in on Zuckerberg’s cryptocurrency is Switzerland’s finance minister Ueli Maurer, stating that central banks will not adopt Libra and its basket of currencies that make up its reserves.
“I don’t think [Libra will succeed], because central banks will not accept the basket of currencies underpinning it.” – Swiss Finance Minister
These are tough words for Facebook, which has received heavy criticism on all fronts, including how it manages the data of its users and its attempt to launch a currency.
Such an attempt could effectively render most banks obsolete. The key component of why governments and banks have shunned Facebook’s cryptocurrency is because Facebook has achieved what many have never done…
Facebook has access to sensitive information for millions of people and can effectively organize, predict, and create insights from data on its users’ behavior!
This is the type of power that Hitler and other dictators throughout history could only dream of. With a fully accessible currency, Facebook would not only control what its users do, but it would also control/influence how and where people spend their money.
Owning a Facebook wallet would reduce the reliance people have on banks, creating a shift of dependency from high-street banks to Facebook’s own global cryptocurrency system. This realization served as the ultimate call to action for central banks to sit up and take ALL digital assets more serious, hence the heavy zero-tolerance rules we now see directed towards Libra and the scramble of banks launching their own digital currencies.
Regulatory Clarity is Still the Key Issue; Don’t Underestimate Zuckerberg!
“The project, in this form, has thus failed.” – Swiss Finance Minister
While Facebook is not the most trusted platform available online, it’s still extremely early for its Libra cryptocurrency and too early to call it a failed project because the Libra association still has a wide variety of members.
Large corporations are on the sidelines waiting for full clarity because they can’t afford to make mistakes. The Cryptocurrency Act of 2020 could provide a vital legal framework and work in favor of Libra’s ambitions…
This post is for educational purposes. All information used is referenced accordingly. This is not investment advice; please always do thorough research and only invest what you are willing to lose, especially in times of uncertainty.