Facebook’s Marcus: Striking Libra as a Threat to the US is a Win For China’s Digital Currency
As we already know, after five years of research, the People's Bank of China is very close to releasing its digital currency.
While China has been focused on creating a central bank digital currency, the US has no plans for the same in the near future, though they are looking at it.
In the meantime, the US-based Facebook is working on its cryptocurrency project Libra which is being scrutinized from regulators worldwide. US lawmakers got even a step further and threatened the companies and CEOs by sending a letter to the Libra Association members to quit the project.
As such seven members including PayPal, Mastercard, Visa, and Stripe have left the Association.
As such the social media giant is warning the US regulators that derailing Libra’s plan would be a huge win for China.
“The future in five years, if we don’t have a good answer, is basically China re-wiring” a large part of the world “with a digital renminbi running on their controlled blockchain,” said David Marcus, who is leading the Libra.
A Real Threat to the US
While US officials are trying to figure out how to regulate Facebook’s digital currency, Marcus said Beijing is plowing ahead with its digital payments system with global reach.
China’s progress, Marcus told Bloomberg, could present a real threat to US influence.
He further warned about “having a whole part of the world completely blocked from U.S. sanctions and protected from U.S. sanctions and having a new digital reserve currency” with no alternative.
Facebook has highlighted threats posed by China previously as well. In April 2018, when CEO Mark Zuckerberg testified before Congress, he pointed out that China would be strengthened by the breakup of US tech companies.
Marcus also gave speeches defending Libra to the global leaders at the G7 meeting with the World Bank and IMF while meeting the staff of Democratic and Republican members of the House committee.
Last week, Marcus had said, “Look, change of this magnitude was going to be hard all along.”
On the criticism that the company should have done more to get regulators onboard before going with the plan, Marcus told a small group of reporters, “Even if we spent 10 years outreaching, you’d still hear the same thing.”
On Wednesday, Zuckerberg is expected to testify about Libra at a hearing held by the House Financial Services Committee.