Libra, the much-scrutinized proposed cryptocurrency from Facebook (NASDAQ:FB), has “failed in its current form,” according to Swiss President and Finance Minister Ueli Maurer.
Swiss President Critical of Libra Basket
Maurer, who is in the final days of his year-long term as President of the Swiss Confederation, was speaking to the country’s national TV network SRF when he said, “I don’t think (Libra has a chance in its current form), because central banks will not accept the basket of currencies underpinning it,” adding that “the project, in this form, has thus failed.” The Libra Association, the body overseeing the digital coin, is currently headquartered in the Swiss city of Geneva.
Libra is set to be backed by a basket of fiat currencies, including the US dollar (50%), the euro (18%), the yen (14%), the British pound (11%), and the Singapore dollar (7%).
Libra Launched in Switzerland Despite Criticism
The Libra Association officially launched in Geneva in mid-October, with 21 members signing its charter. The charter was originally meant to be comprised of 27 backers; however, that number was reduced following several high profile departures in light of the intense scrutiny leveled at the planned coin from regulators and governments on both sides of the Atlantic. Some of the backers that jumped ship include Visa (NYSE:V), PayPal (NASDAQ:PYPL), and Mastercard (NYSE:MA), after it emerged that Mark Zuckerberg was to defend Libra before a US congressional committee.
The plans to launch Libra have been immensely criticized due to its potential to undermine the economic sovereignty of nations as well as Facebook’s poor track record in relation to data protection, particularly given its role in the Cambridge Analytica scandal, which saw the personal data of about 87 million users harvested through a personality quiz app called This Is Your Digital Life.
Libra co-founder and chief economist of Calibra Wallet Christian Catalini has said that the digital currency is not in competition with fiat currencies but rather aims to provide banking services for unbanked and underbanked global citizens. It remains uncertain as to when the digital coin will be officially launched, but it is believed that the Libra Association is aiming for a mid-2020 release.
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