Facebook is reportedly planning to launch its ambitious project Libra as early as January 2021. The digital currency will be launched in a limited format than originally anticipated.
According to a report by the Financial Times on Friday, three people associated with the Libra project confirmed that the company may only introduce a single dollar-pegged stablecoin, means it will launch a single coin backed 1:1 by the US Dollar. The project is still pending approval from the Swiss Financial Market Supervisory Authority FINMA.
The Libra project was officially announced on 18 June 2019 and the original plan was to launch a token backed by the basket of global currencies. In 2020, due to regulatory pressure, the Libra association dropped the idea of pegging the token with multiple fiat currencies.
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FINMA announced in April this year that the regulatory authority has started processing the licensing application of the Libra Association. “The application filed differs considerably from the project originally submitted, e.g. with a view to the Libra payment system also supporting single-currency stable coins as well as the multi-currency Libra payment token. FINMA will now thoroughly analyze the application. As provided by the FMIA, it will impose extra requirements for additional services that pose increased risks,” FINMA said in a statement.
Backlash from Regulators
The ambitious project of Facebook has seen backlash from regulators worldwide. European and Australian authorities warned Libra Association against potential scams using its name. In recent months, the Geneva-based association added several companies to the organization. According to the official website of Libra, prominent names like Coinbase, Xapo, Shopify, Spotify, Slow ventures, Checkout.com, and Blockchain capital are part of the association.
In 2019, Paypal decided to withdraw support for the Libra project. In addition to PayPal, other names including Visa, Mastercard, Stripe, Mercado Pago, eBay, and Booking Holdings also pulled out of the project citing regulatory issues.