Originally intended to be a global stablecoin that would operate much in the same manner as other similar solutions (such as having various holding accounts throughout the globe and the goal to provide access to the unbanked, just to name a few), the project didn’t have clear definition as to what it truly was and regulators couldn’t approve the cryptocurrency as a result. There was also severe pushback due to Facebook’s power and the belief that it would undermine the importance of existing currencies in other countries.
Now, Facebook is changing its tactics. Rather than sticking with the previous model, it will be rebranding Libra as a cryptocurrency backed by government-issued, fiat currencies in order to gain the favor or regulators and help it reach its anticipated release date, which is supposed to be sometime towards the end of the year.
In addition to the rehashing of their stablecoin to make it more appealing to those in other countries where it would be offered, they also have a plan to redesign their wallet, Calibra, to include existing cryptocurrencies and national currencies that users can use for transactions. Whether they are operating on WhatsApp or Facebook, this makes payments far more flexible for anyone who wants to send money online. Libra will still be a part of the project. However, more assets will be included to tone down the role that the initial stablecoin was supposed to play for Facebook. This solution is also supposed to come out at the end of the year, at the same time as Libra is launched.
While this new Libra plan is certainly a step down from Facebook’s previous plan to completely bypass the traditional banking system through its new global currency, this scaling back may actually allow Libra to thrive rather than be further postponed.
Although there are some rumors going around that Facebook and the Libra Association are giving up on the project entirely or leaving Libra behind, Dante Disparte, the head of policy and communications over at the Libra Association guarantees everyone that:
“The Libra Association has not altered its goal of building a regulatory compliant global payment network, and the basic design principles that support that goal have not been changed.”