The finance minister of France has called on the European Union to block Facebook's Libra coin, a new cryptocurrency the company has begun to publicly discuss creating. He speculates on the damage and risk for abuse of a private firm having power over facebook's 2 billion users and the risk of a breakdown in the functioning of this currency. He also argued that "monetary sovereignty" is the right of governments and allowing a public currency to gain traction in the EU would threaten this sovereignty. Personally I agree with him. facebook has had its fair share of legal and gray issues in the past and letting that same private firm create and issue a currency that is supposed to compete with the Euro and other major currency posses a big risk. However part of the appeal of these currencies is governments warryness about their uses. Historically when countries like the us have spoken out against cryptocurrencies like bitcoin it only leads to a increase in demand and a quick increase in the currencies value. Could this stance just make matters worse?
https://www.bbc.com/news/business-49677146
I agree with you, I think money and currency is the responsibility of governments and if we give allow private firms to handle it, it could quickly get out of hand. Facebook has been criticized many times for its privacy issues, and releasing unauthorized data so if this kind of private data of users was hacked it would definitely be an international crisis! It may make matters worse but I'm not sure what the alternative should be.
ReplyDeleteI agree with you Andrew! I think that it could be a systematic risk situation as Facebook has about 2 billion users and if this breaks through all these people will be reliant on a currency system. Any breakdown in the functioning of this currency, in the management of its reserves, could create considerable financial disruption. Moreover, I don't think Facebook is a credible source to circulate currency as Ramsha said , it has been criticized for its privacy and unauthorized data release issues. Therefore, such a thing would only make matters worse on an International level.
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