The Libra Association has been tweaking its crypto project whitepaper in an attempt to scale back ambitions in order to win regulatory approval.
The social media monopoly came under heavy fire last year when it announced lofty ambitions to effectively become the world’s bank through the creation of its own cryptocurrency.
According to a recent blog post, the Libra Association has formally initiated the payment system licensing process with the Swiss Financial Markets Supervisory Authority (FINMA).
We have initiated the formal payment system licensing process with @FINMA_media and updated our white paper to reflect key design changes to the Libra payment system. https://t.co/jiGnufzOtj#FinancialInclusion #TechforGood pic.twitter.com/1zdwoalG8I
— Libra (@Libra_) April 16, 2020
The Facebook-backed consortium also said that it now plans to offer stablecoins backed by just one nation’s currency in addition to those backed by multiple currencies.
The move is a change of tack by the company which originally wanted to be in control of its own, completely new, currency.
Now it appears that its proposed payments platform will operate on a similar basis to PayPal as a standard digital payments service.
Speaking about Libra’s change in direction, eToro CEO and co-founder Yoni Assia told Micky, “We believe these changes make significant progress in enabling Libra to potentially launch. They are now taking a more regulated approach, as we discussed in our position paper, published in November last year, where we recommended a shift towards working with local regulated institutions in supporting transactions in national currencies.”
The change could also ease concerns among U.S. lawmakers who feared the new currency could compete with U.S. dollar dominance.
Project lead and former PayPal president, David Marcus, touted his vision of the benefits it could provide in a tweet yesterday.
Excited with the progress of @Libra_ in the last 9 months. I keep on thinking about all the people and small businesses that could benefit from the Libra Network already being operational — especially now during these times of unprecedented hardship. 1/8
— David Marcus (@davidmarcus) April 16, 2020
The benefits to Facebook, however, would far outweigh any that the public would get. There are already several decentralized payment solutions and currencies available that are not controlled by one monopoly.
According to Assia, “The main downside of these changes is that the system is less open and less decentralized, therefore the bitcoin community will probably disregard this as another centralised project.”
Featured image courtesy of PickPik