Facebook’s Libra is far from broad acceptance as a world currency

Naoyuki Iwashita ()
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Naoyuki Iwashita: Kyoto University School of Government

Evolutionary and Institutional Economics Review, 2021, vol. 18, issue 1, No 18, 335-339

Abstract: Abstract Facebook’s Libra intends to provide a financial infrastructure for the people living in the developing countries in which financial inclusion rates still fall low. Libra plans to stabilize the market by holding legal currencies as collateral. However, markets determine prices, and there is no guarantee that the prices can be controlled as intended. As long as a central authority holds legal currencies as collateral and issues the Libra, it cannot be a decentralized structure like bitcoin. Libra plans to move to a permissionless blockchain within 5 years, but no concrete steps have been proposed yet. Thus, it would be difficult for Libra to be realized and widely accepted as a world currency.

Keywords: Libra; Blockchain; Financial inclusion; Bitcoin; Regulation; Anti-money laundering (search for similar items in EconPapers)
JEL-codes: C88 E5 G28 K2 (search for similar items in EconPapers)
Date: 2021
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DOI: 10.1007/s40844-020-00165-2

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