The new director of China’s Research Institute on Digital Currency, Changchun Mu, believes that even though the world powers do not welcome Facebook’s Libra coin, the stablecoin and its advance is now unstoppable. The Chinese crypto czar officially assumed his role at the Institute on September 6 this year, leading the online education platform.
There have been six lecture issued by the crypto chief – shared on many best cryptocurrency news sites and local media outlets.
In the series, Mu answered a range of crypto questions – ranging from Libra and its technical features – to the potential integration with the international currency system. The Chinese crypto czar also touted the advantages of China’s own digital currency and how it compared to Libra.
“No countries welcome Libra, but it might be unstoppable anyways,” Mu said in the third lecture of the series. “It is very unlikely that one can totally stop people from buying Libra despite rigorous regulations.”
The Chinese crypto czar also explained that the most a central bank could do to prevent Libra from entering a country would be to ask all of their payment institutions and commercial banks not to process any transactions which are related to Libra.
Still, there are a few back channels through which users could circumvent the ban to purchase Libra, as he noted. The czar also cited underground Bitcin trading in China as an example of how it could work.
Even though exchanges in China have blocked Bitcoin transactions and payment institutions (and commercial banks are also prohibited from processing BTC transactions) there are still some agencies which use virtual private networks (VPNs) to buy Bitcoin from foreign exchanges, as Mu noted.
The Chinese crypto czar said that the situation applies to Libra, too. “Even if Facebook is blocked in China, people will use indirect ways to purchase it from abroad once Libra comes out,” Mu said.
As he also said in the latest cryptocurrency news, there was only one possibility to stop Libra. “If the U.S. bans Libra legally, then Libra will certainly be stopped.”
There are a few extreme cases where a country fully embraces Libra, the Chinese crypto czar said. He noted that Zimbabwe (a country with rampant inflation) last year announced that it welcomes any alternative currencies. As such, Zimbabwe is a clear example of such country.
G7 Says ‘Global Stablecoins’ Are A Threat To Financial Stability
"The G7 believe that no stablecoin project should begin operation until the legal, regulatory and oversight challenges and risks are adequately addressed. [...] Addressing such risks is not necessarily a guarantee of regulatory approval for a stablecoin arrangement."The G7 also says that global stablecoins with the potential to scale rapidly are the ones that could stir up the competition and threaten the financial stability if users lose confidence in the coin. The report will purportedly be presented to finance ministers at an annual meeting of the International Monetary Fund this week.The BBC features that G7 says that while the report does not single out Facebook's Libra stablecoin project - it could spell further trouble for the already beleaguered proposed payments system, the Libra news show.On the other hand, we have global regulators that are increasingly leaning on the project. The Bank of England (BoE) recently established provisions with which it must comply before it can be issued in the United Kingdom.The CEO of Facebook, Mark Zuckerberg, will testify before the United States House of Representatives Financial Services Committee about Libra this month. Earlier this year, the committee drafted its “Keep Big Tech out of Finance Act.”While G7 says that stablecoins like Libra are a threat to the financial system, it seems like the backers behind Libra are on the same page. If you followed our previous news, you probably know that on October 4, the major payments network PayPal withdrew from the organization - later followed by Visa, Mastercard, Stripe and eBay.Furthermore, we saw Finco Services of Delaware initiating a lawsuit against Facebook and alleging trademark infringement, unfair competition, and “false designation of origin” regarding the use of the Libra logo.
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“Visa has decided not to join the Libra Association at this time. We will continue to evaluate and our ultimate decision will be determined by a number of factors, including the Association’s ability to fully satisfy all requisite regulatory expectations.”Silly or not, the exits from the Facebook Libra Associations leave the upcoming stablecoin with no major US payment processor which is a serious issue for the fledgling project. This also tops up the news that PayPal officially withdrew from Libra a week ago.The first official meeting of the Libra Council is in just two days from now - scheduled for October 14th in Geneva. On this meeting, it is expected for Libra to review all the members involved and ditch the recent departures, focusing on the bright side of the upcoming project.
“We highly respect the vision of the Facebook Libra Association,” eBay said in a statement when withdrawing from the Association. “However, eBay has made the decision to not move forward as a founding member. At this time, we are focused on rolling out eBay’s managed payments experience for our customers.”Stripe also gave a similar explanation for its withdrawal from Libra, stating that while they are "supportive of projects that aim to make online commerce more accessible for people," the company will "remain open to working with Libra at a later stage."All of these diplomatic answers made Libra also get out in the open. The policy chief at the company named Dante Disparte thanked the companies for their ongoing support and said:
“We are focused on moving forward and continuing to build a strong association of some of the world’s leading enterprises, social impact organizations and other stakeholders. We look forward to the inaugural Libra Association Council meeting in just 3 days and announcing the initial members of the Libra Association.”Facebook Libra is expected to launch in 2020.
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“We remain supportive of Libra’s aspirations and look forward to continued dialogue on ways to work together in the future. Facebook has been a longstanding and valued strategic partner to PayPal, and we will continue to partner with and support Facebook in various capacities.”
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