Libra

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Facebook's Mark Zuckerberg wants to start a global currency, and change The World of Finance for billions of people. But Many - including the mighty in the Policy , The Bank bosses and regulators Don 't like the idea one bit. Why?

balance, Facebook's proposed new digital currency that is not get a balanced reaction.

"I Don 't think you should Start scales at all," said U.S. Congresswoman Carolyn Maloney . US President, Donald Trump , leaders of the G7 Nations, and The Head of The Bank of England, Mark Carney have all expressed concerns that the Scale also.

Now, the UK Information Commissioner's Office has The Chorus of skeptics.

Some of the bystanders, because Facebook has used terms like "blockchain" and "decentralized" in his statements about the balance that a system like Bitcoin.

In other words, it would be a grassroots digital currency that anyone can buy and in what would be extremely difficult to close.

But balance is not really such a thing as Bitcoin. It Will be managed, in fact, Central to a basket of other currencies and assets, which are used to set the value of the balance, keeps it much more stable than the highly volatile Bitcoin.

currency creation?

And, of course, Calibra - a digital wallet for Libra - be built directly into some of The World 's most popular apps: Facebook, WhatsApp and Instagram . Facebook Inc owns all of them.

financial upset bigwigs, because Facebook, a company that appears on a government-like role in the creation of a currency, and perhaps even to influence the Monetary Policy .

Instagram , Whatsapp, and Facebook users Will be able to pay soon, with the balance of each other

Everyone investing in this currency Will then, with the vagaries of the Scale Association. And balance should become popular, it could be the fear of the impact on other currencies and economies, critics.

Those who, like Carolyn Maloney , who think all this should be stopped its tracks also have some tricks up your sleeve. This is probably the reason why Facebook has promised that before the start of the Scale .

Too big to fail?

"This is an alternative of money," says Prof Ross Buckley the University of New South Wales . "It's not about the easy treatment to get coins in a game. "

Virtual currencies, which you can use to trade items in online games such as World of Warcraft, or the commodity-like cryptocurrencies, such as Bitcoin and Ethereum, are, in essence, a liberation from the strict rules that can be applied to national currencies, and shares.

in order To be successful, the balance can be regulated in Many countries and perhaps in competition with their currencies,

Prof Buckley and his colleagues all about the various legal pitfalls in Facebook's way. The conclusion is that the scales are a type of control - it can not be ignored.

"the Scale is perhaps the ultimate example of something that is very likely to be of the "too small to care" to "too big to fail" in a very short time," The Paper notes.

What is it?

Prof Buckley gives the example of developing countries, where Many who live there left to work on money transfers from citizens abroad. These transfers, known as remittances, are the high fees that the G20 Nations.

But Facebook, the whole system could disrupt the night, if the people in these countries, the switch of the balance. It could be like M-Pesa, a digital currency popular in some African countries, But on a much larger Scale .

Jerry Brito says, the Scale of the future is hardly secure

that could be useful in the short term for those so dependent on remittances. But the widespread use of the Scale could also have an impact on the economy of a whole nation, some - for the better or for the worse.

To monitor Scale properly, the controller must ask, what kind of financial instrument it is. Nobody has a good answer yet. Prof Buckley thinks that Facebook is the your own white-paper on the Scale is intentionally vague.

regulation

regulators and politicians have been thrown, in essence, a gauntlet by the tech giant: you tell us what kind of control that could get in our Brand New currency and we Will respond accordingly.

But not all roads to success, says Jerry Brito, executive director of crypto money research agency coin Center.

If the regulators decide authorities, the Scale is more like a stock or bond, it is very closely regulated

"If at the end of The Day , it is [regarded as] a security, then it may not work as a currency, and perhaps we Facebook see leave The Project ," he explains.

This is because the securities, tradable financial assets such as stocks and bonds, are very strictly regulated.

Other crypto currencies have largely.

any amount of licenses

But Mr Brito thinks that Facebook aims to be the regulatory authorities in the class Scale as a means of payment, or, perhaps, a new kind of security, which faces a little less draconian regulation.

as soon As the national regulation, and decide authorities, how you want to handle, the scales, is the most important tool that you can use to the have ratified it, is the licensing, says Prof Buckley.

Facebook would need to apply for a license in a country in the Calibra as a payment tool to offer. And to the licences that would have The Company to show that it can detect, and the money stop-laundering and the financing of terrorism, for example.

Facebook or its subsidiary companies may need to institutions licenses to operate as financial trading, again depending on how the regulatory authorities view the Scale .

Try to ignore, licenses, and standards would not end well.

"He must be willing to a Total outsider who is basically a criminal organisation," says Prof Buckley. "I'm not even sure that Facebook are willing to the. "

crisis plan

It does not remain, although others consider that the existing rules may treat be able to. As Prof Lana Swartz , University of Virginia points out, no one really knows what the Scale Association wants with its money Policy .

"Theoretically, if a financial crisis hits, is The Goal of the Central bankers is the stabilization of the monetary supply and the financial recovery in your country Will move in that direction," she explains.

Prof Lana Swartz says, no one really knows how Facebook would try to stabilize its currency

"With Facebook, it is unclear whose interests are taken into account, in trying to stabilize the balance. "

And to whom the balance Association would be accountable to accountability, International? There, things become even murkier.

Scale could start to be stopped ever, it is true.

But it's supposed to launch and be a hit, no one really knows how it is regulated, around The World . The politicians and bank bosses are there to try to buy time.

If the thing does not get out of the ground, you need to ask yourself what you can do on earth, it in chess.

facebook, cryptocurrency, libra, information commissioner' s office, money

Source of news: bbc.com