Facebook-run Libra plans to launch a dollar-pegged stablecoin in January 2021
Libra, the Facebook-linked stablecoin that is repeatedly targeted by lawmakers, could start as early as January 2021, albeit in a more limited format than the multi-currency basket originally envisaged.
According to a report by Financial Times (FT) on Friday, the Libra stablecoin project could bring a single dollar-pegged stablecoin to market next year, according to “three people involved in the initiative”.
The global stablecoin project was originally intended to be tied to a basket of multiple fiat currencies, but was rejected by project leaders in April due to regulatory pressure from lawmakers in the US and internationally.
Project leaders announced that Libra could be introduced as a series of stablecoins, each pegged to a fiat currency, rather than a multi-currency basket in this revision.
Now, according to the FT, Libra’s “Global Stablecoin” will simply be introduced as a single coin with 1: 1 collateral in US dollars, pending approval by the Swiss financial supervisory authority FINMA.
Other currencies in the basket and in the aggregate could be introduced at a later date. The dollar-pegged coin could hit the market as early as January without naming its sources, according to the FT.
Facebook announced the Libra project in June 2019 and announced its vision for global stablecoins.
Backlash was immediately encountered from lawmakers around the world citing concerns about Libra’s ability to compromise financial stability or facilitate money laundering.
The social media giant helped found the Libra Association, a board member for the project, later that year. It currently has 27 members.
Despite its limited form, such as a one-to-one exchange with the US dollar that could reassure policy makers, the project still faces a significant uphill battle as regulators find a way to suppress the digital payments industry and broadcasters and hold recipients responsible for their transactions.
According to Coindesk