Facebook says Libra could use a series of cryptocurrencies pegged to different currencies


A "Zuck Buck" is displayed on a monitor as David Marcus, the chief leading Facebook's blockchain initiative, is questioned by U.S. lawmakers in Washington, D.C., on July 17, 2019.

Andrew Harrer | Bloomberg | Getty pictures

Facebook has advised its Libra project may use multiple cryptocurrencies backed by completely different existing currencies just like the greenback, instead of having one single digital token tied to a basket of currencies.

The school big had at the start planned one artificial unit important  that will be tied to a basket of currencies and government debt. however in keeping with Reuters, David Marcus, the chief leading Facebook's blockchain initiative, told a banking seminar that he was receptive viewing different approaches.

"We may make out otherwise," he said, in keeping with the news organisation. "Instead of getting an artificial unit … we have a tendency to may have a series of stablecoins, a greenback stablecoin, a monetary unit stablecoin, a sterling pound stablecoin, etc."

Stablecoins area unit cryptocurrencies that area unit sometimes pegged to government-backed currencies just like the greenback. Tether is that the world's known stablecoin, backed by the greenback, tho' it's garnered some difference of opinion over whether or not it's a comfortable quantity of greenbacks in reserve, similarly because the suggestion that it may are used for market manipulation.

Such currencies aim to scale back the volatility seen in virtual currencies like bitcoin and ether. In libra's case, the target is to make a additional economical cross-border payments system.

But the Switzerland-based Libra Association, that oversees the planned cryptocurrency, has two-faced varied setbacks since the beginning of the month, with numerous original member corporations as well as payments giants Mastercard and Visa retreating.

And as payments corporations withdraw from Libra, there aren't any immediate signs that banks can be willing to hitch. J.P. Morgan CEO Jamie Dimon on weekday known as the group's currency "a neat plan that'll ne'er happen."

Libra has conjointly been met with fierce regulative pushback, with authorities round the world distressed the currency may heavily disrupt the economic system and probably be used for concealment or terrorist finance.

Last week, the cluster of Seven (G-7) aforementioned in a very report that no stablecoin project — Libra enclosed — ought to be allowed to travel ahead till the connected legal risks area unit self-addressed.

Meanwhile the monetary Action Task Force, a worldwide watchdog on illicit finance, aforementioned that such digital currencies may inhibit efforts to throttle on concealment and terrorist finance.

Facebook may realize some solace within the proven fact that the chief of Germany's monetary regulator does not assume libra can escape anytime before long. BaFin President Felix Hufeld told CNBC over the weekend that he does not assume the social media firm's digital token is "dead within the water." in the meantime, fellow school big IBM has aforementioned it's receptive operating with Libra.
WATCH: Don't think Facebook's libra is dead in the water, BaFin president says

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