When the whitepaper for Facebook’s Libra cryptocurrency project was published in mid-June, it was immediately met with regulatory backlash. Lawmakers and government officials commented that Facebook was too big, that Libra came too fast, and that cryptocurrency in general is still too risky to operate on such a large scale. Some regulators called for a moratorium on the project; others said that Libra must never be recognised as a sovereign currency.
But now, central banks may be looking to take one step further. If nothing else, the creation of Libra–and the resulting hype–highlighted a global need for faster, more efficient, and further-reaching payment systems and financial services.
After all, payment systems are lagging behind even in parts of the developed world – for example, in the US, chip-and-pin payments have only been introduced in the last five years, while it has been the norm in most of Europe and parts of Asia for more than ten years. Access to financial services–loans, credit, investments, and more–is still heavily limited in some of the world’s more remote regions.
The spotlight on these issues may be the reason that the Bank for International Settlements–known as the central banker’s bank– said inits annual report that coins backed by tech giants could "rapidly establish a dominant position."
But rather than explicitly calling for governments to put an end to Facebook’s cryptocurrency project (or similar projects), Agustin Carstens, the General Manager of the BIS, recently said that countries may need to start to seriously consider launching their own digital banknote to fill consumers’ needs before Libra has a chance to. Read More at FinanceMagnates...