The EU antitrust chief is all set to scrutinize Facebook Inc.’s plan as Libra could possibly lead to the creation of an entirely separate economy.
Non- Users Will Be At A Potential Disadvantage
Per a recent Bloomberg report, the European Union antitrust- chief in an interview with Denmark’s finance industry union, Finansforbundet said that the EU is all geared up to unravel the real intentions behind Libra.
“It’s a new thing that we’ve begun to ask questions about something that doesn’t yet exist. But it’s because we want to be far enough ahead that we can say whether this will be a problem.”
She has already started an investigation into Libra for the fact that it has a potential for anti-competitive behavior. This implies putting the parties who don’t use Libra at a disadvantage. Furthermore, she said that there are inherent financial stability concerns as the competition kicks in. It is highly likely that central banks will be the ones most interested in it.
In a recent report, Cœuré, Member of the Executive Board of the ECB expressed the fact that while stablecoins are specifically designed to fulfill one more of the problems described, Libra was designed to efficiently solve those pertinent issues.
A number of so-called “stablecoin” initiatives, backed by large technology or financial firms and built on blockchain technology, are designed to address at least one and, in the case of Libra, both of these failings. Although private digital forms of money have been around for decades, these new initiatives have access to large networks of existing users and customers, which suggests that they could be the first to have a truly global footprint.”
The interview is due to be published in full on the 11th of October. Some of the few questions which Vestager has been asked include the company plans to become a platform for commercial businesses to sell their products and services; what currencies will be accepted; and what does it mean for a company to have its own currency.
What will be Libra’s ultimate plight? Will it see green light by regulatory authorities? Let us know, what you think?