- Criticism against Libra persists regardless of a successful testnet
- R3 CEO claims Libra’s strategy is stupid and naïve
- New Bills proposed by congress to legislate stablecoin
Facebook Libra News Today – Criticism against Libra persists from leading voices both from the public and private sectors in the crypto sphere as they share their doubts about the imminent stablecoin network. It has been a stressful week for the Libra Association, although it was stated that its testnet has administered over 50,000 transactions across 34 projects, even though with this development front-runners from both private and public sectors continue to doubt Libra.
CEO R3 claims Libra’s strategy is stupid and naive
As criticism persists against Libra, the Libra Foundation has taken another approach to regulation which has so far drawn several comments from leaders. One outstanding comment was from David Rutter, the founder, and CEO of large Blockchain Company R3. Rutter commented at a conference held in London that Facebook’s Libra strategy was “ridiculously stupid and naïve, the way they rolled it out… Yeah, you know it was just so… It was just so in your face. There’s a lack of understanding.”
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The Deputy Secretary of the U.S Treasury, Justin Muzinich probed an audience of banking specialists to deliberate on “if a decade from now there was a desire for a stablecoin to go from fully reserved to partially reserved, or to shift its underlying mix of reserve currencies, would that decision be made by a private governing association?” He stated his concerns about foreign actors controlling stablecoins, underlining concerns posed by the imminent stablecoin network to U.S security and financial stability. Even though in his speech, Muzinich did not mention names, his comment “a stablecoin network with an underlying mix of reserve currencies” raises concerns from regulators globally.
New Bills proposed by congress to legislate stablecoin
On Thursday, Congress called for increased regulation of Libra as a new bill was proposed by two members of congress. The bill is expected to legislate stablecoins like Facebook’s Libra as securities under the U.S law. The new bill termed the “Managed Stablecoins are Securities Act of 2019” was proposed by the House Financial Services Committee’s Lance Gooden, R-Tex, and Sylvia Garcia, D-Tex.
With this bill, if Libra is established to be a security, it would be subject to extreme inspection by the U.S Securities and Exchange Commission, (SEC). In a press statement released by Garcia, he stated that “managed stablecoins, such as the proposed Libra, are securities under existing law. This legislation simply clarifies the statute to remove any ambiguity. Bringing clarity to the regulatory structure of these digital assets protects consumers and ensures proper government oversight going forward.”
Max writes about blockchain projects and regulation with a special focus on United States and China. He joined Smarterum after years of writing for various media outlets.