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After meeting a list of obstacles in an attempt to pass regulations for its ambitious Libra cryptocurrency project, Facebook has been set back in their goal to launch it in 2020. Switzerland’s president, Ueli’ Maurer, has expressed disappointment in the project as Facebook’s team continues its efforts to seek regulatory approval within the country.
Ueli’ Maurer has called Facebook’s project a failure in the present state of the cryptocurrency and has stated that in order to be approved it needs to be further reworked.
Maurer has not made any detailed suggestions regarding what measures the social media company should take in order to pass the regulatory board but told a broadcaster in Switzerland, SRF, that he doesn’t think that Libra stands a chance of going through with the project with the problems in its current state because central banks will not grant an approval due to the conventional fiat currencies to which the cryptocurrency is pegged.
Maurer, who currently also serves as both the finance minister and president of Switzerland, said in the interview that because of the reasons stated, he thinks that Facebook’s cryptocurrency project has therefore failed in its current form. Libra’s team has not responded to the statement made by the Swiss president and what measures it plans to take regarding getting the required regulatory license in Switzerland in order to move forward with the project that is due to be launched next year.
Major Obstacles May Delay Libra Cryptocurrency’s Launch
Since the announcement of the project in June of this year, Facebook’s cryptocurrency project received a lot of backlash from politicians and regulators regarding issues like privacy concerns for consumers and Facebook’s ability to change the traditional financial structures across the globe by influencing monetary policies. Facebook’s huge user base that extends to over two billion makes their involvement in the financial realm a very influential step that could potentially bring a lot of changes in the landscape that traditional regulators might not approve of.
The Libra Association, a coalition based in Geneva will govern and issue the cryptocurrency. David Marcus, who is running the Libra crypto project has talked about the obstacles that the company is facing and stated that these issues could potentially push the launch towards a delay and might not meet its deadline of June.
Libra has to be backed by a reserve of financial assets which could range from bank deposits to a government debt, and thus render Libra as a stablecoin. This is done in order to avoid fluctuations and build a trust with consumers and investors.