EU Begins Antitrust Scrutiny Of Facebook’s Libra Project

EU Begins Antitrust Scrutiny Of Facebook’s Libra Project
August 22, 2019

 

The cryptocurrency market has turned bearish as there was not enough momentum to trigger another round of rally. Once again, Bitcoin (BTC) succumbed to pressure, falling below $10,000 levels. The most popular cryptocurrency has lost 4.2% in the past 24 hours to trade at $9,894. Likewise, Ethereum (ETH) has lost 3.4% to trade at $184.25.

However, Ripple (XRP) has lost 1.5% to trade at $0.2628. Other altcoins which have lost ground in the past 24 hours include (LTC-$71.48, -3.4%), EOS (EOS-$3.48, -3.0%), Cardano (ADA-$0.0474, -0.21%) and Tron (TRX-$0.0168, -1.1%),  LEO (LEO-$1.21, -5.4%), Monero (XMR-$79.31, -3.5%), Bitcoin Cash (BCH-$296.12, -3.5%), OKB (OKB-$2.78, -7.6%), Stellar (XLM-$0.0666, -2.7%) and Dash (DASH-$88.79, 2.1%). Among the top twenty cryptos by market cap, Huobi (HT-$4.9, 0.53%) is the only one to remain in the positive territory.

Government level initiatives

PBoC on the verge of presenting its government-backed cypto

The People’s Bank of China (PBoC) is nearly ready to unveil its government-backed cryptocurrency.  The development of central bank digital currency (CBDC) is perceived to have been influenced by the launch of Libra cryptocurrency project by Facebook.  After almost five years of research and related development work, the CBDC is now ready for the launch, according to Mu Changchun, deputy director of the bank’s payments unit. For a while, the bank has been conducting trials, with more than one approach to the project. If everything works out well, the digital currency may be unveiled before the launch of Libra.

Interestingly, Yang Dong, director of the Research Center of Finance Technology and Cyber Security at Renmin University of China, has revealed that the launch of Libra project encouraged Chinese regulators and developers to involve several non-government entities in the development of cryptocurrency and issuance procedures.

Regarding the launch of China government-backed cryptocurrency, Yang Dong stated as follows: “Further testing is needed before officially launching the Chinese CBDC, gaining inspiration from the Libra.”

Private sector initiatives

Austrian telecom operator, A1, accepting cryptos in selected stores

A1, one of the major Austrian telecom operators, has begun to accept cryptos as payment in seven chosen shops in the country. In pre-determined A1 venues, clients of A1 will be able to pay for the services offered by the company using Bitcoin (BTC), Ether (ETH), Litecoin (LTC), XRP, Dash (DASH) and Stellar (XLM).

In mid-June, A1 Payment service, an electronic payment system built in partnership with Austrian cryptocurrency expert Salamantex, German cashless payment facilitator Concardis and French smart payment platform provider Ingenico was introduced.

Along with the prevailing cashless payment facility, A1 Payment will also facilitate customers to pay using popular Chinese payment processors such as Alipay and WeChatPay in August.

Markus Schreiber, head of A1 Business Marketing, stated that settlement with cryptocurrencies is turning out to be more common worldwide and cash is hardly used, resulting in enormous implications for various industries. He further noted that the latest crypto endeavor would permit A1 to cater to the demand and acceptance of cryptocurrencies.

During the trial, A1 clients will get a pre-determined exchange rate for chosen cryptocurrency at the time of opting for a service. The service provider will bear the risk related to price volatility while completing a transaction. The venues accepting crypto payments are Kärntnerstraße, Wien Mitte The Mall, Krems Bühl Center, Graz Herrengasse, Linz Landstraße, Salzburg Europark, and Innsbruck Kaufhaus Tyrol.

WhatsApp looking to introduce digital payment services in Indonesia

WhatsApp, the messaging service owned by Facebook, is negotiating with several digital payment companies and also the state-owned Bank Mandiri, which already operates a crypto wallet service, to introduce digital payment services in Indonesia.

Other organizations with which WhatsApp is presently negotiating are Go-Jek, a transport booking service, DANA, a mobile payment facilitator, and OVO, a financial technology startup firm.

WhatsApp intends to aid payments via digital wallets in Indonesia. Reuters report also states that dealings with Indonesia could be used as an experience to understand how to comply with local regulations and evade bans on cryptocurrency wallets provided by overseas enterprises.

One of Facebook’s executives affirmed that WhatsApp is in discussions with suitable finance-related firms in Indonesia, but refrained from providing additional details: “WhatsApp is in conversations with financial partners in Indonesia about payments, however the discussions are in early stages and we do not have anything further to share at this stage.”

Even if the discussions are completed quickly, the service is expected to launch only in 2020 as WhatsApp is planning to enter the Indian market at that time. Facebook, notably, is awaiting regulatory approval from India for launching WhatsApp-based payments.

Miscellaneous

The European Union’s antitrust regulators have forwarded a questionnaire earlier this month to Facebook to assess whether it’s Libra project is ‘anti-competitive.’ The commission is interested in knowing whether rival firms will be able to contest with the product offerings of Libra Association in a fair and transparent manner. The EU officials believe that Libra may obstruct competitors through information exchange and utilization of client data.

Furthermore, regulators have started scrutinizing the manner in which Libra may be used in WhatsApp and Messenger apps. Notably, the EU’s antitrust division is not the only institution investigating the Libra project. The EU’s financial services unit stated that it is “monitoring market developments in the area of crypto assets and payment services, including Libra and its development.”

Disclaimer: Any financial trading analysis offered here is our opinion and is not intended as advice or direction for investors. We cannot guarantee the success of any trades made as a consequence of this article, and we encourage traders to incorporate a strong money management strategy to limit losses when they enter the markets. Please use this article as part of your own research before formulating strategies prior to trading.

Sammy

Sammy

Sammy is our forex expert, with over 20 years experience in the financial sector, she will be keeping you up to date with the ups and downs of currencies around the world


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