Libra has seen both ends of the spectrum, on the one hand, many in the crypto community are seeing it as a historic event, while those in the government view it as a fundamental threat to their power and authority. And this is to be expected, people in power will always try to protect their privilege at all costs. What seems to be different about Libra is that it has managed to spook all governments from China to the US and EU. While all of this is going on, a newspaper in Germany has managed to get hold of the makeup reserve Libra is going to hold and has published it, and between all of this IBM has offered to work with Facebook on Libra.
Breakdown of Libra’s basket
Libra is a stable coin which means that its value will be fixed and the crypto will be backed by assets, in this case, a basket of national currency. From the beginning itself, it was known that the US dollar will make over 50 percent of the basket. Now, a leak by the German paper Der Spiegel claims to know the exact breakup of the basket. The mix of currency will contain 18 percent euro, 14 percent yen, 11 percent British pound and 7 percent Singapore dollar. An interesting point to note here is the absence of the Chinese yuan. A number of reasons could be behind it including the Chinese government’s hostile attitude towards capital outflow (they actively stop money from moving outside of the country). The breakdown was passed to the German far-left lawmaker Fabio De Masi. He is also a former member of the European parliament who believes that Libra is a threat to democracy, freedom and financial stability. This might sound extreme but views on Libra tend to be so when it comes to lawmakers around the world. The French finance minister even said that France has plans to ban it.
IBM’s helping hand
While all of this heat is going on, most companies want to distance themselves from Libra. There are even talks about members of the Libra association leaving the consortium. And in comes IBM with an offer to work with Facebook. IBM is no stranger to blockchain technology. They have been working with the Linux Foundation and has co-founded Open Ledger, an open-source development platform for blockchain, and IBM has a suite of its own product developed on top of this technology like the hyper ledger fabric, etc. However, IBM has made clear that it is not interested in crypto but tokenization of assets like real estate and other assets. IBM’s general manager of blockchain services Jason Kelley had this to say, ”We talk about Libra and people say it’s just another crypto. […] Set crypto aside and talk about tokenization, because that’s what we’re talking about.” IBM is not part of the consortium of companies who are part of the Libra association, so it remains to be seen how this partnership if even materialize will workout.
The reaction we have seen from lawmakers from all over the world surrounding crypto has been one of shock and awe. No politician has come out in support of the project even though it is a centralized system that depends on the national currency and is ready to comply with all laws and regulations. This might sound like paranoia, but let’s not kid ourselves. The ultimate aim of crypto is to take down control of central banks and governments over the economy. Governments better watch out as there is no way to stop the revolution.
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