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Facebook, Inc.(NASDAQ:FB) weighs Libra revamp to win over reluctant regulators
Facebook Inc.and its partners are considering redesigning the Libra cryptocurrency project so that the network accepts multiple coins, including those issued by central banks, in an effort to woo reluctant global regulators and rebuild momentum for the plan.
When Facebook unveiled Libra, it said it intended to create a single global digital currency.
Anyone, especially the 1.7 billion people who have no bank account, could send money anywhere in the world at little cost, as easily as sending a text.
Eight months later, after the idea ran into a wall of opposition, Facebook and the Libra Association, the consortium behind the digital currency, are looking at a revamp, said three people familiar with the matter.They are weighing a recast of Libra as mostly a payments network that could operate with multiple coins, two of the people said.
The coins could include those issued by central banks and backed by the U.S.dollar, the euro or other currencies, the people said.The association will re-introduce Libra soon, said the people, who asked not to be named because the redesign remains in flux and the plan could change.
The dream of a single global coin isn’t dead, said one of the people familiar with the overhaul.
The new plan could expand, not pull back from, the original vision, that person said.
But if the revamped Libra becomes more of a payments network than a single, global cryptocurrency, the average U.S.consumer might not see much difference between Libra and existing payments systems run by PayPal Holdings Inc.or numerous fintech startups that aim to seamlessly move funds around the globe.
Facebook and the Libra Association declined to comment.
Central bank officials have also said that if Libra issues a coin backed by multiple currencies, it would undermine their ability to manage their own currencies.
Since Facebook announced the Libra project, several central banks, including the Bank of England and the European Central Bank, have said they are exploring their own digital currencies.The overhaul is intended to ensure that the new payments network would be compatible, rather than in competition, with those projects, the people said.
Libra and Facebook officials have spent the past few months traveling the world to speak at conferences, making the case that a payments network such as Libra could lower the cost of money transfers.
At the World Economic Forum in Davos, Switzerland, in January, Facebook executive and Libra co-founder David Marcus emphasized that the Libra network wouldn’t preclude central bank projects.
“I want to really make that distinction between the network and the assets that are running on top of the network, which I think could be issued by many different entities whether it’s central banks or the private sector,” Marcus said, signaling that Libra’s new form could host multiple digital coins.
“We think there’s a lot of momentum building,” said Jennifer Campbell, the founder of Tagomi, one of the new members of the consortium.She said Libra “is definitely first and foremost a payment system.Within that there’s definitely also a coin that’s part of that strategy.But it’s first and foremost a payment network.”
Libra could still face hurdles.Congressional staff and officials associated with Libra have said the project might be defined as systemically important, people familiar with the matter said.
Should that happen, Libra could get yet another layer of regulation by the U.S.Federal Reserve, which would mean following its rules on equity capital and stress testing.
The Libra Association originally planned to launch its cryptocurrency this year, and Campbell said the technology is already being tested.But solving the regulatory challenges could take much longer, and Facebook has vowed that it won’t stay in the project without U.S.approval.Technical Indicators
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
By the way, prices are vulnerable to a correction towards 203.48.
The projected upper bound is: 203.94.
The projected lower bound is: 179.01.
The projected closing price is: 191.47.
Candlesticks
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles.During the past 50 bars, there have been 28 white candles and 22 black candles for a net of 6 white candles.
Momentum Indicators
Momentum is a general term used to describe the speed at which prices move over a given time period.Generally, changes in momentum tend to lead to changes in prices.
This expert shows the current values of four popular momentum indicators.
Stochastic Oscillator
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20).The Stochastic Oscillator is 50.6815.This is not an overbought or oversold reading.The last signal was a buy 2 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas.
The current value of the RSI is 38.40.This is not a topping or bottoming area.A buy or sell signal is generated when the RSI moves out of an overbought/oversold area.The last signal was a buy 3 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas.
The current value of the CCI is -84.This is not a topping or bottoming area.The last signal was a buy 0 period(s) ago.
MACD
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line.The last signal was a sell 7 period(s) ago.
Rex Takasugi – TD Profile
FACEBOOK INC A closed up 5.870 at 191.760.Volume was 49% above average (neutral) and Bollinger Bands were 110% wider than normal.Open High Low Close Volume___ 189.170 191.830 186.390 191.760 23,062,472 Technical Outlook.