LIBRA AS A 'GLOBAL CURRENCY': A PRAGMATIC CONCEPT OR A UTOPIAN VISION?

Abstract

The blueprint of Libra – a low-volatility crypto-currency envisioned to enable a simple global currency –was released in June 2019 with the expectation of a launch in early 2020. Though crypto-currencies have completed a decade of their existence since the release of Bitcoin in 2009, the highly complex block-chain technologies, volatility in prices and anonymity of user base have kept the central banks and laymen equally skeptical in using them as a medium of exchange, thereby failing to gain their widespread adoption. Through Libra, Facebook, Inc. makes an attempt to regain the confidence of consumers by guaranteeing value preservation and independent governance merged with a compliance-friendly approach. Nonetheless, it is stormed with controversies and concerns from financial regulators and governments across jurisdictions. This paper identifies the various concerns unaddressed in the Libra white paper. It highlights certain concerns generic to stablecoins that are aggravated in the Libra framework and discusses the specific financial stability concerns ingrained in it. In this evaluation, it analyzes the legal nature of the Libra coin by weighing it with the notion of ‘money’. It notes the quasi-monetary qualities of the coin and seeks to decipher the impact of these monetary properties in changing the conventional notion of money, as it is currently perceived.