Tag: Facebook Libra

Zuckerberg Remains Silent on Facebook Libra in His Predictions for the Next Decade

In a recent Facebook post, Mark Zuckerberg, the founder, and CEO of Facebook laid out his predictions for the next decade. In his Facebook post, Zuckerberg said that Facebook was planning to create tools for the ecommerce sector. The company will focus on tools that help small businesses access technology that was previously only accessible by large companies.

Decentralizing Technology

Facebook Libra CryptocurrencyAccording to Zuckerberg, it will soon be possible to sell products via Instagram and offer support via Messenger. Additionally, customers will soon be able to send funds to their loved ones via Whatsapp. The result is that small businesses will essentially become tech companies.

While Zuckerberg talked about decentralization, it was not in the context of blockchain technology or cryptocurrencies. Instead, it relates more to the democratization of the ecommerce space. A concept that is already quite prevalent in Silicon Valley with various startups such as Uber have made their mark.

No Mention of Facebook Libra

For people in the crypto community that have been following up on the Libra, it was obvious that Zuckerberg did not mention the project once in his vision for the decade. Instead of talking about Libra, Zuckerberg chose to highlight other projects that the company was working on such as virtual reality and even the creation of a new community governance model.

One reason why Zuckerberg may have chosen to avoid Libra this year is due to the controversy it has raised amongst legislators globally. Various governments in most of the Western world, including the US and most of the major economies of Europe have all expressed concern about the project. There have even been calls for the project to be shelved by members of the US congress.

It would appear that due to the fallout from the initial announcement of the project, Zuckerberg is trying to distance Facebook from the project. In short, while Facebook will still be a core partner of the project, it does not intend to base its ecosystem around the project.

One of the major opponents of Facebook Libra on the global stage is the French government. The nation’s finance minister has expressed concerns that the project might undermine the monetary sovereignty of central banks globally. Another person who does believe in the project is the finance minister and the president of Switzerland, he recently declared the project a failure in its current form. This was a notable observation since the headquarters of the project are in Switzerland.

Besides external pressure, the Libra Association itself has been facing a lot of strife. The result was that various key members such as Visa and PayPal abandoned ship. However, all of them have expressed an interest in rejoining the project later.

Libra is Still On

Australia’s Central Bank Will Never Allow Facebook Libra in the Country

A recent report indicates that there is no hope for Facebook Libra in Australia. According to the report, the Reserve Bank of Australia says it does not any see any justification for making huge regulatory adjustments to accommodate Facebook Libra.

Various central banks around the world have been wondering how Facebook Libra could be regulated. Many have expressed concerns about its impact on their monetary policies. Meanwhile, Facebook Libra has been engaged in a global charm offensive to try to convince regulators to accept it.

However, in a recent submission to the Australian Senate, the Australian central bank said that Facebook Libra should not be allowed in the nation without strict regulation. The bank then noted that the demand for the currency was not clear even with the strict regulation.

In its submission, the central bank noted that there was already a low cost and efficient real-time payment infrastructure in place, pointing to the New Payments Platform. The bank also noted that when it came to cross-border payments various players had stepped in the recent past and it was now cheaper and more efficient to make cross border payments.

Central Bank Digital Currencies

In its submission, the Reserve Bank of Australia noted that digital currencies like Libra had led to a discussion about central bank digital currencies. The central bank said that there was no need to launch a centralized digital currency since it could negatively affect commercial banks operating in the nation.

The bank noted that there was currently little demand for such a digital currency. However, it said that if demand for a CBDC grew, it would lead to a fall in deposits in commercial banks and reduce the funds available for lending to households. This submission by the central bank shows the hurdles that Facebook Libra will need to overcome before it can gain global acceptance.

Global Efforts to Regulate Libra

The Financial Stability Board, which is a global body that regulates the financial sector, is expected to produce a report in 2021 on Facebook Libra for the G20. Meanwhile, the G7 has found that while Libra could help to enable quick and secure cross-border payments, there were still legal uncertainties that needed to be addressed. It also noted that issues such as taxation, the risk of money laundering, investor protection, and data privacy, needed to be dealt with soon.

Most financial experts expect that the biggest impact of Facebook Libra will be in emerging economies where demand for stable coins and efficient money transfer platforms was in great demand. The central bank of Australia noted that while digital currencies had the potential to impact its mandate, it was looking into the possibility of issuing a centralized digital currency.

Will Not Allow Libra

According to the bank, Facebook and its partners could leverage their large user base to launch the Facebook Libra coin. However, no matter what happens, Libra would not be allowed in the nation, according to the bank.

 

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