US President Donald Trump says very clearly that he is not a fan of cryptocurrencies, and went as far as saying that Facebook may need a banking charter if the company wants to launch Libra. According to an article on CNBC, attributed to Yen Nee Lee, and our internal sources, Trump now joins many central bank chiefs, as well as Federal Reserve Chair Jerome Powell, French Finance Minister Bruno Le Maire and Bank of England Governor Mark Carney – all of these leaders speaking up against Libra.
And in our view, against Facebook as many of the leader in Europe and the US are now somewhat skeptical of the practices – especially with regards to privacy – of Facebook and other big tech giants that are viewed as living by a different set of rules, according to some surveys. Facebook and other social media companies will, in the future, be subject to even more scrutiny from European and US regulators as well as free speech activists.
Our Views: The notion of companies designing their own currencies and working outside the laws set by the state is viewed by some as radical and destructive to the system. China and Russian are big supporters of cryptocurrencies – as long as they are used in other states like the US and members states of the EU – but not on their shores. Developing a currency and competing with the state, the national government result in jail time.
In China, one can get the death penalty for less, so the question would be just what is China doing investing so much in something that is illegal at home. For the US, the Federal Reserve does not want competing currencies, as they feel the US dollar is and will remain King of the currencies.