- Facebook-led Libra will launch a USD-pegged stablecoin in early 2021.
- The original Libra Coin was pegged to a basket of fiat currencies, which faced a massive backlash from regulators.
Share this article
After facing lengthy backlash from regulators worldwide, a pared-down version of Facebook’s Libra project will finally launch in January 2021.
Zuckerberg’s Libra Takes Flight
According to the initial white paper, Libra Coin was described as a coin pegged to a composite of multiple fiat currencies: US Dollar (USD), Euro (EUR), British Pound (GBP), Singapore dollar (SGD).
The idea of multi-currency stablecoin did not sit well with the regulators, who vehemently opposed the project, calling it a threat to global financial security.
Conceding to regulators, the team renewed its whitepaper by adding stablecoins denominated in single fiat currencies. According to a report from Financial Times, the January Libra launch consists of a stablecoin pegged 1:1 to the US dollar (USD).
Independent crypto journalist, David Gerard, told Crypto Briefing:
“This is even more cut down than the Libra 2.0 plan from April. So, this is basically Paypal-but-by-Facebook, with US dollars. But if they still do it as crypto-coins backed by a reserve, there’s the same issues with the size of the reserve, if it’s at Facebook scale.”
Libra’s USD-pegged stablecoin is the first of what will soon be many single fiat-based coins to be launched in the future.
Facebook will be the first large technology company to issue USD-based stablecoin. Besides Facebook, many cryptocurrency exchanges and financial companies have issued USD-based stablecoins in the past.
The social media giant introduced the project in June 2019 and outlined its vision for a global multi-currency Libra Coin (≋LBR) for its 2.7 billion users.
The project is governed by the Libra Association, a consortium of private companies led by Facebook and headquartered in Switzerland.
The team has not yet confirmed the roll-out of the USD stablecoin. The Swiss financial regulator, FINMA, has approved the launch.
Facebook’s Libra Facing Fresh Wave of Doubt
Facebook’s Libra cryptocurrency is facing more speculation that the project may not get off the ground in 2020, according to media reports. What’s In a Memo? An alleged government memo…
As Payment Firms Abandon the Libra Association, Who’s Next to Go?
Following last week’s news that PayPal was backing out of the Libra Association, almost all of the payment firms initially linked to the project have now announced their departure. Over…
Avoiding Common Trading Mistakes
Being a successful trader is one of the most difficult pursuits that any person can undertake. The path to success is littered with countless examples of even those who are…