The soon to be launched Libra, a coin for trading sponsored by Facebook, has met a daunting obstacle in Germany. Despite the advancements that will be possible with the success of this block chain technology, authorities are unsettled.
Earlier this week, the cryptocurrency project has been taking blows as it is set to go live in 2020. The French Finance Minister, Bruno Le Maire, had fingered it as a threat to other currencies. One report claims that the Minister had said it was going to cause financial instability for other Sovereignties.
All this came after representatives of Libra cryptocurrency had set up a meeting with officials from about 26 central banks. This included the US Federal Reserve and the Bank of England. The meeting was scheduled for the representatives from the Facebook umbrella project to answer questions.
It would seem that the answers provided were not satisfactory enough to allay the fears. Many of the officials fear that Facebook Libra might cause wreck the policies monitoring money around the world. The representatives had tried to assure them that the cryptocurrency was not coming to fight the US dollar or Euro.
The fears are majorly about the risk that the coin would pose to European Union state’s Sovereignty. What the German wing argued is that the cryptocurrency should not be used to develop private forms of money.
While the potential of the technology is admitted, Olaf Scholz, the German Finance Minister is quoted to have said that they would not allow private companies to issue new currency. This is because it is one of the most important element of a state sovereignty. It is likely seen as too much power in the hands of a private individual as opposed to a state.
We also found reports that an international central bank digital currency was proposed. To help the global reserve currency status of state’s currencies if the private cryptocurrencies begin to challenge them.