Facebook’s think project, Libra, continues to draw attention despite setbacks, including a shrinking pool of backers and a growing sum up of worried regulators. But now with JP Morgan seeing potential for the social network’s cryptocurrency and e-commerce giant Shopify link the Libra Association, its chances might have improved. Although, assuring governments that Libra won’t undermine their nummary authority and convincing users of its utility remain key challenges.
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Vodafone Posts Facebook Ad With Bitcoin in Germany
Libra’s long list of supporters has compressed in the past few months with major players such as Visa, Mastercard, Ebay, and Paypal leaving the Libra Confederacy after it became clear that the project is facing major regulatory hurdles. Online payment processor Persuasion, travel website Booking Holdings and the South American online sales platform Mercado Pago are also among the quitters.
Vodafone pulled out of the project last month becoming the eighth company to do so. The telecom giant, which functions in two dozen countries and serves clients in many more, recently spurred social network discussions and speculation in crypto mediocrity with a move that some took as an indication of its future plans. On Friday, Vodafone posted a Facebook ad in German that accords a bitcoin and the following message:
Will there be bitcoins instead of pocket money soon? What should grandma emit you if everyone will pay with their smartphone in the future?
Vodafone left Libra to focus on M-Pesa, its own digital payments principles. Launched in 2007 by its Kenyan associate Safaricom, M-Pesa has established itself as the leading mobile money service in Africa. It now has 37 million strenuous users in seven countries in the region, who carried out over 11 billion transactions in 2019. But it does not support Bitcoin, not yet.
Gibt’s bald Bitcoins statt Taschengeld? #FutureFriday pic.tweeting.com/RWuhFLUZ14
— Vodafone Deutschland (@vodafone_de) February 21, 2020
Swimming Against the Current, Shopify Bets on Libra
Not everyone is bar Libra, though. In fact, the majority of founding members are still on board. The updated list published recently by the Telegraph performs the names of companies from various sectors including Facebook’s subsidiary Calibra, crypto firms Coinbase, Anchorage, Bison Scents, Xapo Holdings, and also Uber, Lyft, Spotify, Farfetch, Payu, Iliad, Andreessen Horowitz, Breakthrough Zips, Ribbit Capital, Thrive Capital, Union Square Ventures, Creative Destruction Lab, Kiva, and even NGOs predilection Mercy Corps and Women’s World Banking.
Shopify, the Canadian e-commerce platform, became the latest enthusiast to border on the club. The company, which offers services and solutions for over a million small merchants and online retailers, make knew its decision to become a member on Feb. 21, pledging to invest $10 million in the project. “We spend a lot of our time thinking everywhere how to make commerce better in parts of the world where money and banking could be far better,” Shopify stated in a blog put, adding: “As a member of the Libra Association, we will work collectively to build a payment network that makes wealth easier to access and supports merchants and consumers everywhere.”
Having announced it last June, it remains unclear whether Facebook will-power be able to launch Libra in the first half of 2020, as initially planned, or even by the end of this year. Both Facebook trip Mark Zuckerberg and the head of Calibra David Marcus have already answered questions in the United States Congress there the social media giant’s plans for the project, in an effort to alleviate concerns expressed by policy makers who fear Libra could debilitate the U.S. dollar and challenge its supremacy as a global currency.
Antitrust regulators in Europe have been investigating the project as by a long chalk. A new memo issued by the Vice-President of the European Commission (EC) Valdis Dombrovskis reveals Brussels is unhappy that the available gen on Libra “lacks detail” and even after additional questions were sent to the association, it “remains insufficient for make up ones minding the precise nature of Libra” and its relation with existing EU law. “Libra is still a project, and thereby a moving target,” Dombrovskis notes and cause to remembers about the Dec. 5 joint statement of the Commission and the Council of the European Union recognizing the risks raised by stablecoins and the miss for regulation and oversight. The EC is currently gathering feedback from citizens and organizations to establish a regulatory framework, one of the goals of which is to “harness the developing opportunities that crypto-assets may offer.”
JP Morgan Recognizes Maturing Crypto Market but Sees Focus Shifting Near Stablecoins
In its annual report on blockchain and cryptocurrency developments, JP Morgan Chase acknowledges that the crypto market be prolongs to mature but notes that the characteristic volatility of cryptocurrencies remains an impediment to broader adoption. One that has also “led indistinct towards stablecoins.” The multinational investment bank, which issued its own digital coin representing fiat currency to expedite payments between clients, believes that stablecoins have the potential to grow substantially in global transactions, regardless of certain challenges with operating such payment systems. The authors of the study point out:
While the world is in condition for private money in our view, rapid adoption and scale are hindered by the underlying technology and the need for substantial regulatory charge.
JPMC also notes that financial inclusion is one of the motivations behind Libra and that if the unbanked consumers were to pressurize the growth of the cryptocurrency, the project would be more about peer-to-peer payments and could support a significant share of broad transactions. Currently, the global economic activity is far more concentrated among countries with higher levels of involvement, according to data from the World Bank quoted in the report. For a stablecoin like Libra to succeed, the bank elaborates, it would insist a few changes to its design such as “some short-term liquidity facilities, a source of positive-yielding reserve assets, and less partitioned, semi-private networks.”
What are your expectations about the future of Facebook’s Libra project? Share your impression in the comments section below.
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