Visa, Mastercard, PayPal & Stripe Hadn't Join Libra

Payment providers fear that participation in the project will negatively affect their relations with regulatory authorities along with other concerns
02 October 2019   212

Payment companies Visa, Mastercard, PayPal and Stripe are in no hurry to sign official documents on participation in the digital currency project Facebook, Bloomberg reports.

Firms believe that Facebook is exaggerating the level of support for the project from regulators, who express more and more doubts about Libra. Payment providers fear that participation in the project will negatively affect their relations with regulatory authorities, which are critically important for their business.

Companies are also concerned about Facebook data processing and privacy issues.

Facebook is keen to sign the Libra Association by October 14 to formally secure the participation of companies announced in June in the consortium. Despite the fact that the signing of the charter does not oblige potential participants to invest $ 10 million in the project, they hesitate regarding this step.

The Minister of Finance of France Bruno Le Mayr spoke out against the development of the Libra project in Europe, the German government went even further, deciding to ban all such stablecoins.

US Federal Reserve to Consider Digital USD Issue

If a some country or company issues digital money that is widely recognized, this could lead to the loss its status by the USD, fed official believes
17 October 2019   66

The US Federal Reserve is actively considering the possibility of issuing digital currency, fearing the dollar will lose its leading position in the global financial system. This was stated by President of the Federal Reserve Bank of Dallas Rob Kaplan, reports CoinDesk.

In his opinion, if a foreign government or company issues digital money that is widely recognized, this could lead to the loss of the status of the world's reserve currency by the dollar.

On the eve of the previous chairman of the Commodity Futures Trading Commission (CFTC), Christopher Giancarlo also expressed concern that the re-issuance by other countries of national currencies in digital form could lead to the dollar losing its dominant role in the world. He called for the release of a digital dollar on the blockchain.

Bank of England Governor Mark Carney said earlier that a digital currency like Facebook’s Libra can replace the dollar as a global reserve currency.

The emergence of an attractive and viable alternative to the dollar will reduce demand for US government securities, Kaplan said. This will lead to an increase in interest rates by 100 basis points (1%), which will increase the cost of servicing public debt by $ 200 billion per year.

I still think for the foreseeable future, the dollar will be the world reserve currency, we’re able to refinance our debt at relatively low rates, but I don’t think we should take that for granted.
 

Rob Kaplan

President, Federal Reserve Bank of Dallas

Kaplan noted that countries subjected to sanctions or increased trade tariffs by the United States are working most actively on the digital alternative to the dollar.