So, you’ve probably heard that Facebook is launching a cryptocurrency called Libra.
Cue a barrage of ridiculously OTT tweets, blog posts etc from industry observers and players (“the virus is spreading”…yeah, thanks for that, Pomp), attempting to sell the notion that this will propel crypto into the mainstream.
But wherever Mark Zuckerberg goes, controversy inevitably follows. And sure enough, not everyone is loved up on Libra. Here are our six favourite thumbs down responses from the past week…
“Facebook has rightly identified the potential for digital currencies to reinvent money and transform the global economy, so people can live better lives. However, a digital currency controlled by tech cartels such as Facebook, Visa and Mastercard, is not the solution. Our money is increasingly in the hands of a small number of banks and payment companies, and we should avoid ceding further control to unaccountable corporate interests. Facebook’s plans pose alarming implications for privacy and power in the economy, and governments must respond by providing a central bank digital currency as a public alternative.
If regulators come under pressure to give the likes of Facebook access to central bank reserves, we should ask why this privilege shouldn’t be extended to ordinary citizens as well, through a central bank digital currency. This would offer an opportunity to truly democratise our money system and take power away from extractive middlemen like banks and now tech companies. It is publicly-issued digital currencies, not Libra, that will allow people to take back control of their money and have a greater stake in the future.” David Clarke, Head of Policy, Positive Money
“The new Facebook coin is a fake cryptocurrency. They are calling it cryptocurrency because it is a buzzword. It may be a digital currency, but it is not a cryptocurrency. It is a crap coin.” On Yavin, CEO and Founder, Cointelligence
“There is a lot of sense in the way Libra addresses the need in global money. However, if the control over the currency remains in the unelected hands of Facebook and its commercial partners alone, this might very well turn the dream into a nightmare for all of us. Libra is a combination between a central and a commercial bank. This means that just like any other central bank, Facebook holds the keys to money printing.
The control over the supply of money determines its value. In other words, a decision to print more money equals the decision to dilute the holders’ value. While central banks have the power to do so under the state’s elected representatives, where does Facebook and its partners draw their right from?
We’re looking at a complete misalignment of incentive between Facebook and Libra’s holders. It would be like handing the keys to the Federal Reserve to the NASDAQ. We are already experiencing the shortcomings of centralised control over data when there is not a representative body to answer to. Extending this to users’ money and life savings is adventurous, to put it mildly.” Saga Foundation’s Founder and President, Ido Sadeh Man
You can't imagine what could possibly go wrong with Facebook launching a global currency. "We're just a platform, it wasn't out fault people used it to sell drugs, weapons, illegal material, how was anyone to predict this"
Move fast and break society.
— Tom Goodwin (@tomfgoodwin) June 18, 2019
I recommend the reading of all the Financial Times series on the unreliable and dangerous Facebook’s initiative of lauching “a currency”, the Libra. Start with the excellent Martin Sandbu @MESandbu column: “ Don’t let Facebook take over the monetary system”
— Vitor Constâncio (@VMRConstancio) June 20, 2019
Facebook has too much power and a terrible track record when it comes to protecting our private information. We need to hold them accountable—not give them the chance to access even more user data. #BreakUpBigTech https://t.co/eQr06VMMyx
— Elizabeth Warren (@ewarren) June 19, 2019