Friday, August 7, 2020

Libra forced to face (the) books by regulators

The Takeaway:

European Commission's antitrust regulators are investigating Facebook's Libra, Bloomberg reported. Though unconfirmed, it reflects the broad consensus that countries and regulatory bodies have towards Libra. Disapprovers are amassing and bringing up pertinent shortcomings of this digital currency. Libra reported that regulations are impeding its precarious launch. Will this investigation be the final shove to shut its progression?

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Libra, facebook’s digital coin is seemingly facing probes within two-months of its announcement. Reported by Bloomberg, The European Union antitrust regulators are inquiring the said-to-be gamechanger cryptocurrency.

 

Libra – A threat to crypto competitors?

The Commission is concerned with Libra’s capability to transgress the competition laws. Facebook is no new to any investigations. Numerous scandals have surfaced on the platform. The security of the user’s privacy has been a question to the site.

As reported, an EU regulator is reviewing “potential anti-competitive behavior” of the digital currency. The officials are concerned that the projected payment method might unjustly seal the rivals.

Facebook, as the parent of Libra, will definitely affect the economy. The globally used social platform holds more than billions of users. Competitors across the globe will be atrociously affected if facebook’s users adopt this digital coin. The administrators are apprehensive about how Libra can establish “possible competition restrictions on the information that will be exchanged and the use of consumer data.”

However, neither Facebook nor the Union has commented on the inquiry.

 

Government probing is not news to Libra

The awaited crypto coin has succeeded to earn the spotlight even before the launch, though infamously. Earlier this month, UK ICO (Information Commissioner’s Office), along with protection authorities, requested the Libra Associated companies to provide details on how they intend to protect the user data.

 

Libra’s criticism unites Democrats and Republicans

The US Treasury did not hold back in broiling the to-be-launched cryptocurrency. The country portrayed severe concerns towards the misuse of Libra for terrorist fundings, money laundering, cybercrimes, and more.

The US Senators suspected Facebook on secrecy and trust solicitudes and interrogated the selection of Switzerland for Libra’s registration. Swiss Confederation’s unambiguous crypto regulations were the reason cited by David Marcus, for preferring Switzerland over America. Marcus, the head of Facebook’s blockchain division, referred to Swiss Federal Data Protection and Information Commissioner (FDPIC) as their intended privacy regulators but failed to inform the FDPIC themselves. On July 16, Hugo Wyler, a representative of the Swiss Federal Data Protection and Information Commissioner (FDPIC), told CNBC that the Libra promoters had not contacted the agency.

 

Facebook’s past is coming to haunt Libra

Libra has faced plenty of surveillance since the time it emerged into the news. The US lawmakers wrote an open letter to the social media giant executives, calling for a hiatus on the crypto coin’s progress.

Besides, a six-member authority of the US lawmakers visited Switzerland to discuss Facebook’s crypto. The delegation, led by Maxine Waters, the chairwoman of the House Financial Services Committee aimed to refine the regulatory issues revolving around the coin. Waters highlighted the “troubled past” of Facebook regarding its user’s data protection and requested the creators to halt any further actions on Libra till the Congress and other regulators examine the predicaments.

 

No borders can stop Libra skeptics

Accompanying the cynics was the chief of the Reserve Bank of Australia (RBA). Philip Lowe stated, “There’s a lot of water under the bridge before Facebook’s proposal becomes something we’re using all the time.” He hinted at the uncertainty of Libra’s launch and addressed the lack of possibility in its adoption.

 

The Flooding criticism

With no cessation on the revolt against Libra, the social platforms came flowing with the critics. Brad Garlinghouse, the Ripple CEO stated that Facebook had let people down in the area of trust. The tech industry doubted the launch of this crypto coin, and Mark Cuban, the billionaire tech, mentioned Facebook’s Libra as a “big mistake.” To no surprise, Donald Trump left no command and targetted the evolving currency on Twitter. The expansion of Facebook’s Monopoly is the primary concern buzzing around the crypto world.

 

Is Facebook assisting Libra scams?

Don’t you think the scam world is vaster than even the crypto world? Libra did not even launch, but the Libra scams certainly did!

Though Libra’s release is expected in the first quarter of 2020, you don’t have to keep any patience for its deceptions. Numerous websites have claimed to possess Libra for sale or, are already selling the fake Libra coins, clearly worth nothing. The focal point being, the scams are promoted on Facebook, itself, adding more fuel to the fire.

 

Will Libra see the green light for launch?

The cryptocurrency is under fire. Although its progress is frozen until it acquires regulatory approvals, the ice is assumed to see the sun in no time soon. The negative response from the authorities, questions on its wallet’s security services, lack of acceptance, and significant criticism is all that currently walks with Libra.

 

Libra hangs by a thread

What can we actually expect when the parent company is pessimist itself? In the latest reports, Facebook has admitted what many assumed. The tumultuous history of the firm did affect the launch of its financial abyss. The social platform confessed to the investors that Libra might never come into execution. Supported by Uber, Vodafone, Visa, Spotify, and almost two dozen firms, the Libra Association marked the laws and regulations around digital currencies as “uncertain and evolving.”

“Our participation in the Libra Association will subject us to significant regulatory scrutiny and other risks that could adversely affect our business, reputation, or financial results,” Facebook announced.

 

Libra surfaces terror

The regulatory affairs are the only barricade across the survival of the project. The governments fear that adopting Libra might turn into a threat for central bank money and economic sustainability. Also, it may be a pathway for global money laundering and hoaxes.

The company also expressed its lack of experience in blockchain and crypto as another hurdle to Libra’s victorious road.

 

Is Libra a threat or Libra has threats?

Libra, though doubtful of its launch, has sparked threats globally. But, it is not the only one that might reshape the crypto world. After Facebook, various big-name enterprises have announced the grounding of their cryptocurrencies.

Walmart, the retail giant, is all set to battle Libra. The firm is prepped to step its foot into the craft of blockchain as it filed a patent for a new digital stablecoin, backed by the USD. Following the hardships in the way of Libra, Walmart’s journey might possess the same barriers. However, if the coin comes into play, the groups that find banking expensive shall gain some aid with this alternate currency that would be accessible in departmental stores, grocery centers, hypermarkets, and more.

On the other hand, not so unfamiliar, Binance has also revealed the launch of its crypto coin, Venus, to compete with Facebook. The leading trade platform of the crypto business represented its cryptocurrency as a “regional version of Libra.” The firm counts on collaborating with governments and organizations to promote Venus and plans to strike out Libra in the regional businesses.

Will Libra rise from the grounds of regulation? If it does, will it gain the trust of people and will the crypto industry face a revolution?

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Disclaimer: The article reflects the opinions of the author and is not representative of Chaintimes’ views.
The article does not offer any investment advice. User discretion is advised when investing in or trading with cryptocurrency. Extensive and diligent research should be carried out by the reader before making a decision.

Paul Rea
Paul Rea
Paul is a graduate from the Queensland University of Technology and has a demonstrated history of working in the computer and network security industry. Apart from being a dedicated author, Paul also has an interest in graphic designing.

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