Report: Facebook Libra will launch in 2021 as a US dollar-backed stablecoin

TL:DR Breakdown:

• Facebook Libra may be launched by January next year, according to people familiar with the matter.
• Due to the regulatory uncertainties around the token, it will be no longer debuted as a global stablecoin.
• Initially, it will launch as a US dollar-backed stablecoin, while support for other fiat currencies will be added separately in the future.   

According to a Financial Times report on Friday, the long-planned Libra cryptocurrency linked to the social media platform Facebook is set for launch early next year. The report cites three persons who are involved in the token’s development. Rather than launching as a multi-currency stablecoin, the upcoming Facebook Libra will be reportedly backed to the United States dollar, while support for other fiat currency will be introduced at a later date.

Facebook Libra debuts as a US dollar stablecoin

According to the sources, the Facebook Libra cryptocurrency is expected to be launched earlier in January next year. The stablecoin will represent the actual value of a dollar, given that it will be pegged in the ratio of 1:1. Previously, Libra was reportedly proposed last year to operate as a multi-currency basket – that is, a global stablecoin. However, it immediately drew the attention of financial regulators around the world.

The initiative underwent several regulatory backlashes, as many regulators feared that the envisioned path for the Facebook Libra could undermine financial stability, among other risks. So, due to regulatory concerns, the sources are saying that Libra will initially debut as a single US dollar-backed digital currency. Support for other major fiat currencies may be announced at a later date, probably, as the regulators’ tension eases up.

The Libra Association

Since the Facebook Libra project began facing strong scrutiny from regulators, many prominent companies who joined the Libra Association began pulling off as members. However, new entities have been added to the association as recently, as Cryptopolitan reported. There are now about 27 company members in the Libra Association. In October, former HSBC executive, Ian Jenkins, was announced as the new Libra CFO.