You’ve most likely seen in the news this past week or two numerous articles about Facebook’s plan to introduce a new crypto-currency, Libra.
Understandably, the social media giant’s plan has been received with mixed feelings, some think it could well be the future of money, others are approaching it with caution and asking many questions.
Announced to the public last Tuesday were the plans a small team has been working on for the past year at Facebook’s headquarters in California. They told how Libra would make the future of transferring money or paying for goods/services ‘as simple and cheap as sending a text message.’ Impressive? Yes. But, of course, numerous questions were asked, many of which were left unanswered.
One of the main concerns raised was regarding how Libra would be made safe from crooks and terrorists, an issue crypto-currency bitcoin experienced. Mark Carney governor of the Bank of England stated that though he does recognise that there is a need for innovation in the global payments system, neither him nor central banks would just ‘sit back’ and allow Libra to be introduced freely.
Mr Carney advised that though he would cautiously welcome Libra, rules would be implemented from its introduction. He said, “Welcome to the world of finance. There is oversight, there is consumer protection, there is market integrity – people have certain rights to privacy that have to be respected,” he added that a network would not be allowed to come into place that would be a network for criminals and terrorists.
Harsh Sinha, Chief Technology Officer of TransferWise has labelled Libra as an ‘interesting perspective’ and welcomed its entry into the market. Stating that there is a huge potential market for Facebook to aim at, which has room for numerous different approaches, Mr Sinha said, “[…] I think time will tell how things progress.” However, he also warned that it could be a “lengthy and expensive” process to make the new currency compliant and safe.
It looks as though only time will tell what the future looks like for Libra, as questions remain unanswered and many people are approaching the idea with caution.