Libra has "failed" in its current form

The president of Switzerland recently spoke on Libra, Facebook's controversial project on issuing its own cryptocurrency, calling it "failed" in its current form. Ueli Maurer, Swiss economy minister, argues that Libra would not be accepted by central banks, and therefore could not function as a currency.

"I don't think the Libra project will be successful because central banks will not accept Libra currency deposits," Minister Maurer told Swiss broadcaster SRF. "The project, in this form, has therefore failed."

The plans are now outlined

The social media giant unveiled its plans on Libra about a year ago, and plans to launch it on an unspecified date in 2020. Since its announcement, however, it has faced significant criticism from regulators financial and privacy advocates.

Libra shares some features with Bitcoin, such as the use of the blockchain platform, a distributed and decentralized online registry. But, at the same time, it is based on a centralized infrastructure that has the support of large global companies. It is also supported by a series of investments in different currencies, to avoid that there may be the same exchange rate volatility that occurred with Bitcoin. Facebook says that the Libra cryptocurrency, which will be issued and managed by the Geneva-based Libra Association, will be supported by its circle of social networks and applications (including Instagram and Whatsapp), while serving 1.7 billion users worldwide who do not have access to traditional financial services.

With more than 2 billion users distributed across the planet, Libra could potentially compete with the US dollar and destabilize the current financial system. This concrete risk led the Libra cryptocurrency to be permanently rejected in both the United States and Europe. Last September, French economy and finance minister Bruno Le Maire said he would like to ban Libra's advancement in the eurozone because it poses a threat to "monetary sovereignty". In July, British and American politicians expressed concern about Libra.

What the experts think

During a preliminary hearing at the Senate Commission on United States Banking, Housing and Urban Activities, David Marcus, chief of Libra, was told that Facebook "does not deserve our trust" due to the numerous scandals about private data leaks occurred in recent years. In a brief interview after the hearing, Damian Collins, chairman of the UK's Digital, Culture, Sport and Media Commission, said: "Libra suggests that Facebook is almost trying to transform itself into a nation."

To a question from The Independent regarding the reason for an announcement so early compared to the launch date of Libra, there were no official answers from the project spokespersons. But some time earlier, David Marcus had explained that they had acted to placate the concerns that had arisen.

"It will be a long journey," he wrote on Twitter in October. "I can tell you that we are very calm, and we work with confidence on the legitimate concerns that Libra has raised, bringing to the fore the debate on the value of digital currencies."