According to an executive at blockchain start-up Ripple, Facebook is planning to create a digital currency which comes with one major flaw.
Ripple’s senior vice president of customer success, told that “a big problem with the social network’s Libra project is that it’s a “walled garden” — in other words, a closed system.”
Facebook has proposed that libra token will be handled by the Libra Association, a Switzerland-based organization. The members of the Libra Association includes Visa, PayPal and Uber. The coin would be deposited in the Libra Reserve in currencies like the dollar.
Ripple is recognised for its blockchain-based payments network. To move money across borders in real-time, Ripple is used by some of the world’s largest banks. Blockchain was basically known as the network behind bitcoin. Blockchain is a digital ledger that records data across a network of computers scattered throughout the world.
The Ripple exec said that Ripple has “no walled garden” like Facebook’s Libra: “Yes it’s a network, but it has no perimeter. It connects with all of the players that want to use the technology.”
He added that it was, however, still a “really good thing” that a Silicon Valley giant like Facebook was playing a role in the digital asset space. The worry for many governments is that libra is a “threat to currencies.”
Facebook, the social media giant is planning for a digital token which has come under severe analysis from global regulators amid concerns that it could massively disrupt the financial system.
