Libra will have company soon.
When it was unveiled in June 2019, it was seen as the next frontier for technology companies the world over. To the cryptocurrency world, however, Facebook’s Libra was nothing new. It was just another centralized cryptocurrency which was backed by fiat currency, with a fluctuating reserve and regulatory uncertainty accompanying it; the only addition being – Facebook and a cascade of star-studded supporters.
Once Libra set the standard, others made their move. Some acted, and others reacted. China unveiled its plans of launching a digital yuan by next year, while other economic giants were flummoxed. Europe, in response to China’s progress, saw individual statements but no unified consensus on a digital Euro to prevent China from taking hold of the space. Meanwhile, America has not shown its hands.
Libra seemed to have got the ball rolling, with other competitors, both sovereign and corporate, entering the space of digital currency for global payments. This trend is set to continue, according to the Co-founder of the second-largest cryptocurrency. In a recent interview, Joseph Lubin, the man behind Consensys and a member of the team that created Ethereum, said that the future will see a lot more price-stable currencies.
In an interview with CNBC’s Squawk Box, the Ethereum Co-founder said,
“We’ll see many Libra-like projects going forward with different kinds of price-stable currencies offered.”
The way Libra defines “price-stable” is where regulators have an issue. Backed by a basket of five fiat currencies [USD, EUR, GBP, JPY, and SGD] in varying proportions, and short-term government deposits, the Libra Reserve is curated specifically for stability, as per the whitepaper. The composition of the Reserve can be changed by the Libra Association,