Facebook’s Libra will be global, just not really global
Facebook’s Libra stablecoin has been in the news constantly over the past couple of weeks, first as preparations were being made for the big launch, then as it came under extreme scrutiny in several countries. They say that bad publicity is still good publicity, but this most likely won’t be the case for Libra or Facebook once the dust settles. Billed as a truly global financial solution, the Libra is slowly being shown to be anything but truly global.
TechCrunch explains that, to support the Libra, Facebook is introducing the Calibra wallet. The idea is to give individuals without access to banks – of which there are more than 1.7 billion around the world – access to financial freedom. Calibra should be available for download by anyone who uses Facebook’s WhatsApp communications platform, but this isn’t actually going to be possible. Calibra won’t be available in any country that has banned, or could ban, cryptocurrency, or which is sanctioned by the US.
According to a Calibra spokesperson, “The Libra Blockchain will be global, but it will be up to custodial wallet providers to determine where they will and will not operate. Calibra won’t be available in U.S.-sanctioned countries or countries that ban cryptocurrencies.”
This means that countries such as India, Venezuela, Iran and others won’t be able to use Calibra. India has the world’s largest pool of Facebook users, but is most likely going to try to implement a complete ban on cryptocurrencies.
India has a different payments option, WhatsApp Pay, which is a person-to-person payments service. The country is the only one to offer the service, which was created using a government-backed payments solution developed using the Unified Payments Interface. That service is only available to a million users, but the country reportedly has 444.2 million, so there is still not a solid solution for peer-to-peer payments in India.
So far, the U.S. wants Facebook to delay the launch of the Libra, Russia has said it won’t authorize the stablecoin and it won’t easily be available in at least five other countries. This is going to severely limit its ability to be a truly global alternative to fiat.
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