- The concept of digital currency that Facebook came up with was an interesting opportunity initially.
- Facebook isn’t an appealing option for investment anymore, owing to the numerous scandals. It is acting as a roadblock for Libra.
Today, Facebook isn’t an appealing option for investment anymore, owing to the numerous scandals. It is acting as a roadblock for Libra, as it is a much more crucial issue than the loss of support from financial companies or objections from regulators.
How Libra Convinced Investors
The concept of digital currency that Facebook came up with was an interesting opportunity initially. However, Libra was meant to be a ‘stablecoin’ to be decentralised. Libra managed by an Association of groups in Switzerland and backed by a basket of national currencies.
The increasing popularity of stablecoin is due to its offer to get entry to online payments while protecting against the volatility of the cryptocurrency. Since cryptocurrency is still a relatively new concept, it is not widely accepted.
Currently, stablecoins can be backed through a sequence of national currencies, not just through the basket. Money laundering can be avoided by increasing the rigidity of compliance strategies automation. The Association has made its function clear: to manage Libra and the reserve of funds behind it.
Unclear Future for Libra
Although, following a set of unfortunate scandals, Facebook tarred with amplifying fake news and allowing Russian trolls to deceive American voters inside the run-as much as the 2016 election. Facebook’s reputation is creating a hurdle for libra. Also, there has been the Cambridge Analytica scandal, in which Facebook faced a statistics breach involving 87 million users.
Now, Mastercard and Visa have pulled out of Libra, and some of the other financial services firms have taken their support back.
Libra still stands a chance if Facebook would smooth up to its act. For now, the future of Facebook’s cryptocurrency appears to be a gloomy tunnel, one that guilts the company.