Power to Create Money Stays with the Sovereign Not LibraOctober 4, 2019
Bitcoin has not recovered too well, and it is going back to decline before the weekend. Apple is clear that they are not about coming up with their cryptocurrency. However, Facebook is not going back about its stance concerning Libra, and other tech giants are expected to follow.
Tim Cook, Apple Chief Executive, stated that it is not healthy for companies to compete with governments by coming up with their currencies. He further said, “I’m not comfortable with the idea of a private group setting up a competing currency.”
Cook opines that it is not healthy about private companies by gaining power by issuing their own cryptocurrencies. He thinks that it is only suitable for money to stay in the hands of states. He justifies his stance stating that we elect representatives to take up government responsibilities, and just as defence money should remain in the hands of states.
The topic is becoming the hottest in the discussion as Facebook’s Libra has been threatening the sovereignty of nations. Libra will be backed 1:1 by strong currencies, and therefore, any numbers of units in Libra will be equivalent to its reserve value.
With Libra, there is no creation of new money. The power to create money stays with the sovereign.
While the trends are such, it appears that PayPal might not be supporting Libra. The guesswork in this regard is happening as PayPal did not show up for a critical meeting that was held in Washington on Thursday.
It is a point of discussion that PayPal leaving the show will be a significant blow to the overall project scenario.
One of the PayPal spokesperson stated that he was worried about Facebook not having done enough to deal with the concerns of regulators about money laundering.
The spokesperson stated, “It doesn’t seem that there was a lot of pre-work done with regulators.” Further clarity on the fact provides that companies are not interested in regulatory scrutiny bleeding into their business.
While PayPal seems to have backed down, none are denying the probability for PayPal rejoining the project in the future.
Dante Disparte, head of policy and communications for Libra Association, reinstated about their mission by stating: “This journey to building a generational payment network is not an easy path. We identify that change is hard and that each organization that started this journey should make its own assessment of risks and rewards of being committed to seeing through the change that Libra promises.”