Libra Supported By the Bank of England

1 min reading

Numerous countries and institutions are voicing their critical opinions about Libra more and more loudly. Great Britain, however, seems to have a different view on this topic.

Banking sector support

The head of the British central bank, Mark Carney, believes that Facebook clearly has the right to create its own cryptocurrency. He pointed out numerous disadvantages of the existing traditional financial system. Because of the fact that there is a growing number of faults in the payment sphere, Facebook together with an entire Libra Association should be involved in these types of projects.

Above all, Carney criticizes the high transaction costs, arguing that they are hurtful to small and medium-sized enterprises. Apart from the costs alone, he noticed the time of their realisation, which is too slow. In an interview with the Canadian site TheStar Carney says:

"That’s not good enough in this day and age. Those payments should be instantaneous, it should be the same as us exchanging a banknote online. It should be virtually costless and it should be 100 per cent resilient."

Regulations are a must

Mark Carney emphasizes that the above problems can be solved in many ways. It should be essential at the moment to move a level up in international payments in order for it to meet the current standards of countries recognized as important in the world. In many countries, as he highlights, the efforts are being made in this direction.

Legal issues, nevertheless, must not be forgotten. Facebook has been repeatedly criticized for wanting to play the role of a bank, and thus, shaking the banking sector. Carney warns that corporations wanting to solve this problem will have to face a harsh criticizm by state institutions:

"In terms of how this will proceed or not going forward, this will not be like social media. This will not be a case where something gets up and starts running and the system tries to work out after the fact how it’s regulated.  It’s either going to be regulated properly, overseen properly, or it’s not going to happen."