Facebook is reportedly considering offering digital versions of official currencies to restore the confidence of regulators, while continuing its plans for a new cryptocurrency. A choice that carries risks and could change the nature of Libra.
Facebook is downgrading its ambitions, even if it distorts the original project. According to The Information, the Californian company is in the process of reviewing its copy under pressure from regulators. In this article of March 3, 2020, the American site explains that the social network will offer, in addition to its cryptocurrency Libra, digital versions of official currencies, such as the euro and the dollar.
Citing three sources close to the dossier, he said that his Calibra digital portfolio will still allow users to buy products and services as well as make money transfers, but in official currency, like a wallet Classic. It was previously planned to be dedicated to Libra.
Libra new competitor of PayPal?
Facebook plans to co-exist with Libra and official digital currencies backed by central banks, offering users a real payment network. A choice that would delay the deployment of the digital currency by several months, but which would reassure institutions and partners, in a context of successive defections, to restore momentum. According to The Information, the launch of Calibra is now scheduled for October.
Note a consequence that could jeopardize the success of the cryptocurrency: this strategy would place it in direct competition with payment solutions like PayPal in the United States (the first of the founding members to have dropped the project), or those developed by fintech companies such as Obvy, Pumpkin and Lydia to name but a few French start-ups.
Shopify and Tagomi, two new supporters
This information is a positive sign that Facebook wishes to address to critics of the project, who regularly point to its lack of transparency and security in relation to the currencies of the city. However, the cryptocurrency has recently managed to attract two strong supporters. Shopify, the Canadian publisher of e-commerce solutions, and blockchain expert Tagomi announced their rally in February.
Announced in June 2019, Libra was originally conceived as a single digital currency, accessible worldwide for the estimated 1.7 billion people who are not banked. Designed as a financial inclusion project based on Facebook’s social media and applications, its main objective is to enable as many people as possible to pay for purchases, send or receive money without going through an account. and thus bypassing the established financial system.
“The Libra Association has not changed its goal of building a regulatoryly compliant global payment network, and the initial design principles that support this goal have not been changed,” said Dante Disparte, head of Libra Association’s communication in a statement. Facebook said it “remains fully committed to the project.”