Wednesday, October 28, 2020

Libra’s launch stays an enigma: Project loses support amid regulations

The Takeaway:

Libra's inception marked an exceptional rise in the cynics' performance. Since its declaration, the crypto coin has obtained a series of evil tidings, which seems to end no soon. With strict regulatory scrutiny, facebook's currency continues to struggle to gain optimism. Furthermore, the regulations have now ascended to apprehend its investors, fueling the mystery of Libra's launch.

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Libra, the not so imminent cryptocurrency, has left people in the middle of the road concerning their feelings about its launch. Since its declaration, the coin has continued to have its fair share of scrutiny issues. The multi-national regulatory pushback against Facebook’s efforts has not only slowed down the developments in the project but also dropped a dilemma for its investors. 

 

Did PayPal quit supporting Libra?

Currently, Libra is burdened with the fear of losing the firms backing its survival. As per schedule, representatives from all 28 Libra backers were set to meet in Washington on 3 October to plan the further movement of the project. However, the meeting ignited the spark when PayPal’s absence came into notice. As reported, PayPal was the only investor in Libra to miss the meeting. Although this isn’t a concrete sign, yet speculations have risen about the firm’s withdrawal from Libra.

In September, the VP of investor relations at PayPal, Gabrielle Rabinovitch, prominently stated that there is “a lot of work” that needs to be completed before Libra is anything more than “just a very exciting idea.” If PayPal exits, it can lead to a severe blowout for the stablecoin and its legitimacy. As claimed, payment companies do not want to pave the way for regulatory scrutiny into their business. 

 

Authorities firmly oppose Facebook’s coin

Facebook is seemingly unable to fight against the possible threats Libra can deliver to the financial industry, money laundering being the primary concern. The Financial Conduct Authority (FCA) also reports Libra’s tendencies to escort financial exploitation. Last month, France’s economy and finance minister Bruno Le Maire warned about the same. European ministers have threatened to ban Libra due to the risks accompanied to its launch. Furthermore, at this month’s Federal Advisory Council meeting, the biggest banks of the United States were asked to frame their thoughts on Libra, and as cited, they did not recite a favorable belief. 

The US panel wants Zuckerberg 

The US Senate House of Financial Services Committee stands firm in Libra’s opposition. Sheryl Sandberg, the Chief Operating Officer of Facebook Inc, had earlier agreed to testify on 29 October, but the panel has now demanded the presence of Mark Zuckerberg. As per the reports, the committee will not schedule the hearing until Mark commits to appear by January.

 

Visa and Mastercard hesitant to join Libra Association

Visa and Mastercard, the renowned monetary firms, have also taken the route of reconsideration to avoid being on the radar of regulations, reported Bloomberg. The companies had signed a nonbinding contract with the project before its reveal. Alfred Kelly, Visa’s chief executive, stated that the company would not join the association if Libra failed to comply with the regulations. 

 

Facebook hits back at WSJ

Earlier, the Wall Street Journal also informed the sprouting second-thoughts of the firms, fretting about the regulatory and political response to which David Marcus, the current Facebook, and former PayPal executive reverted in a tweet. Though he did not deny the reports, he cited the final formalization of Libra’s partners. 

Member companies of the Libra Association are again set to meet on 14 October in Geneva, Switzerland. The representatives from the firms will also appoint a board of directors for the Libra Association at the meeting.

 

Cynics overweigh the enthusiasts

Where the majority holds a pessimistic view for Libra’s arrival, a minor percentage exists with optimism. Mark Branson, the CEO of the Swiss Financial supervisor FINMA, considers Libra as a safer option than the unregulated cryptocurrencies. Changpeng Zhao, the Binance CEO, stated that there would be nothing to complain about if the currency coverage keeps growing. 

 

Libra released its roadmap

On 2 October, Libra published its roadmap, comprising of four milestones before the mainnet launch. The main aim of the mainnet is that all partners have nodes deployed on the network. The developers have supplemented a Kanban board to enhance the tracking progress. 

Although Libra’s execution is planned for the next year, do you think it will see the light of the crypto world? Or, will its launch remain an enigma?

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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.

Thomas Allums
Thomas Allums
Although Thomas is an experienced writer, he is also a passionate musician who loves to travel often. He is based in New York and loves to spread the word about decentralization throughout his neighborhood.

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