Former PayPal president and head of Facebook’s libra David Marcus has taken to Twitter to challenge the idea that the digital currency will threaten the monetary authority of sovereign nations.
No Monetary Disruption
In a string of tweets published Sept. 16, Marcus took issue with how Facebook’s cryptocurrency is being portrayed as a disruptor of global fiscal policy.
2/ Recently there's been a lot of talk about how Libra could threaten the sovereignty of Nations when it comes to money. I wanted to take the opportunity to debunk that notion.
— David Marcus (@davidmarcus) September 16, 2019
As opposed to challenging the existing framework, Marcus believes that libra will serve as a tool for improvement. He explained that the digital currency is being designed as a “better payment network and system” to work on top of the existing fiat infrastructure.
In addition, he highlighted that libra is a stablecoin deriving its value from a basket of fiat currencies. In order for libra to remain a robust form of payment, it relies upon the continued success of national fiat, rather than creating an all-together new form of money.
4/ Libra will be backed 1:1 by a basket of strong currencies. This means that for any unit of Libra to exist, there must be the equivalent value in its reserve.
— David Marcus (@davidmarcus) September 16, 2019
5/ As such there's no new money creation, which will strictly remain the province of sovereign Nations.
— David Marcus (@davidmarcus) September 16, 2019
Marcus concluded by stating that the Libra Association intends to be in full compliance with regulatory oversight and is willing to work with central banks and lawmakers to ensure the proper implementation of the currency.
7/ We will continue to engage with Central Banks, Regulators, and lawmakers to ensure we address their concerns through Libra's design and operations.
— David Marcus (@davidmarcus) September 16, 2019
Just last week, senior US Treasury official Sigal Mandelker told an audience in Geneva that libra would be held to the highest standard of regulatory compliance in order to combat money-laundering and terrorism funding.
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