Facebook’s Libra currency under fire

Libra has raised eyebrows among the world’s financial regulators, including the Bank of England, the European Central Bank and the US Federal Reserve. (File/AFP)
Updated 14 July 2019

Facebook’s Libra currency under fire

  • Libra will be co-managed by 100 partner firms, including Facebook’s newly-minted financial services division Calibra
  • Libra, which is widely regarded as a challenger to dominant global player Bitcoin, is expected to launch in the first half of 2020

LONDON: Facebook’s planned virtual unit Libra, already under heavy attack from US President Donald Trump and global regulators, faces skepticism among the wider cryptocurrency community as well.
One theme — besides Brexit — dominated discussion among the movers and shakers from London’s financial technology or FinTech industry as gathered for their annual get-together: the future of virtual currencies.
“Can I just ask you to raise your hand if you would not be willing to use Libra?” asked the moderator at an event at London’s recent ‘FinTech Week’.
In the room, filled with about 100 experts and media who closely track the sector, about two-thirds of participants raised their hand to express distrust at the upstart currency.
Helen Disney, founder and boss of Unblocked Events, which promotes the blockchain technology that powers many cryptocurrencies, acknowledged growing doubts over who exactly would oversee and regulate Libra’s operation.
People are “concerned about how the governance... would work,” Disney told AFP.
“The cryptocurrency community is very libertarian in thinking,” its “about giving power to the people, democratization of finance, keeping away from big banks and companies who control (the) economy,” she said
Last week’s gathering came one month after Facebook announced to the world its plans for the virtual currency.
Libra, which is widely regarded as a challenger to dominant global player Bitcoin, is expected to launch in the first half of 2020.
Whereas Bitcoin is decentralized, Libra will be co-managed by 100 partner firms, including Facebook’s newly-minted financial services division Calibra.
The companies behind Libra — which will be backed with a basket of real-world currencies — include payment giants Visa, MasterCard and PayPal, as well as taxi-hailing services Lyft and Uber.
To access Libra on smartphones, users will go through a virtual wallet that will also be named Calibra.
While Facebook boasts an enormous customer base dotted across the globe that should facilitate Libra’s uptake, it firm also been plagued by privacy concerns that could make users hesitate.
“Can’t wait for a cryptocurrency with the ethics of Uber, the censorship resistance of Paypal, and the centralization of Visa, all tied together under the proven privacy of Facebook,” said Sarah Jamie Lewis, head of non-profit research organization Open Privacy.
Libra has meanwhile raised eyebrows among the world’s financial regulators, including the Bank of England, the European Central Bank and the US Federal Reserve.
But Disney believes that Libra will finally force regulators to present clear regulation guidelines, as demanded by the cryptocurrency community itself.
“We have been waiting for a long time for a clearer signal (regarding) the regulation of cryptocurrencies and digital assets,” she said.
But James Bennett, head of cryptocurrency research firm Bitassist, argues that Libra should not be seen in the same light as Bitcoin.
“In the long run, people may realize that Libra is not a cryptocurrency,” Bennett said at the FinTech Week event.
“A true cryptocurrency should be resistant to attacks by all parties, from sovereign states to global corporations,” he said, adding that “cryptocurrency is a type of money used to transfer value over the Internet that cannot be stopped, confiscated or destroyed by any single entity.”
Trump has meanwhile unleashed a vicious attack on virtual currencies, slamming them for their alleged shadowy nature and arguing that Libra had no standing nor dependability — unlike the dollar.
“I am not a fan of Bitcoin and other cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air,” Trump tweeted Thursday.


Apple warns China virus will cut iPhone production, sales

Updated 18 February 2020

Apple warns China virus will cut iPhone production, sales

  • Apple says demand for iPhones is also down in China because many of Apple’s 42 retail stores there are closed

CUPERTINO, California: Apple Inc. is warning investors that it won’t meet its second-quarter financial guidance because the viral outbreak in China has cut production of iPhones.
The Cupertino, California-based company said Monday that all of its iPhone manufacturing facilities are outside Hubei province, the epicenter of the outbreak, and all have been reopened. But the company said production is ramping up slowly.
“The health and well-being of every person who helps make these products possible is our paramount priority, and we are working in close consultation with our suppliers and public health experts as this ramp continues,” Apple said in a statement.
The death toll from COVID-19, a disease caused by the new coronavirus, was 1,770 as of Monday.
Apple says demand for iPhones is also down in China because many of Apple’s 42 retail stores there are closed or operating with reduced hours. China is Apple’s third largest retail market for iPhones, after the US and Europe.
Outside China, Apple said iPhone demand has been strong and is in line with the company’s expectations.
On Jan. 28, Apple said it expected second quarter revenue between $63 billion and $67 billion. Apple’s second quarter ends March 30.
Apple says the situation is evolving and it will provide more information on its next earnings call in April.