The Libra Association founded by Facebook has clarified the previously announced change to its strategy in a document. The payment platform will support multiple single-currency stablecoins, in addition to a multi-currency coin.
Version 2.0 of the white paper of Libra has changed considerably compared to the plans presented in April last year. Those plans for a single stablecoin to be used for payments on Facebook, among other things, were heavily criticized. Regulators worldwide wanted to ban or restrict the platform, after which members of the consortium such as Booking, PayPal, eBay, Visa and Mastercard withdrew.
The Libra Association now writes that a major change is that multiple stablecoins, each based on existing currencies such as the euro, will be supported, in addition to a multi-currency coin. Initially it concerns a few currencies and the organization mentions, for example, a LibraUSD or ≋USD, LibraEUR or ≋EUR and LibraGBP or ≋GBP. “This allows people and businesses to instantly access a stablecoin in their currency on the Libra network.” Each of the stablecoins is backed by a reserve of bank balances in the respective currency. Whoever wants to pay in the EU in the multi-currency Libra, in fact pays with LibraEUR, the value of which is linked to the euro. The organization hopes in time to be able to integrate any digital coins from central banks itself, so that the various associated stablecoins can disappear.
The change should prevent a global coin of private parties on a large platform such as Facebook from arising outside the regulation of regulators. For example, the fear was that internet users in countries with volatile currencies would resort to Libra. The Libra association also claims to have improved the security of the payment system and to have taken measures to better protect the reserve. In addition, the plan to switch to a permissionless blockchain in the future has been scrapped. With that, the system will continue to run on the proposed permissioned blockchain, which is in fact a distributed database.
The intention of Facebook is to offer its users a Calibra wallet with which they can, for example, make quick and easy payments between themselves in Libra and buy products with a smartphone, for example by scanning codes.