I confess - I was thinking like a conspiracy theorist when I learned the final details around Libra, the upcoming cryptocurrency led by Facebook and backed by dozens of other major corporations.
Libra's entire model is so dependent on the US Dollar, that together with their plans to be used world wide - I thought "Surely this was planned WITH the US Government" or at least while consulting with them.
But I couldn't have been more wrong, as we learned this week that isn't the case, when US Treasury Secretary Steve Mnuchin instead came out and expressed huge concern over the whole thing.
The fact is, and i'll explain why - this could only strengthen the USD if it succeeds, and have no effect on it if fails. Hardly cause for huge concern.
So is the word 'cryptocurrency' really just so confusing, that it can create reactions like this?
Let's compare these fears, with the simple truth.
If you're catching up, here's the basics:
Libra is a 'stable coin' so it will always be worth exactly $1, every 1 Libra = $1 USD. So unlike Bitcoin, Ethereum and others - this won't be a coin you find people investing in for profit. It's only use is transnational.
They will then hold USD reserves to back up each Libra coin in circulation.
Now let's look at the two categories the Treasury Department's concerns fall under.
1) Integrity of the US Dollar...
A Libra token represents literally nothing more than a US Dollar, no different from one in your bank.
This is the main reason i'm stunned by Secretary Mnuchin's reaction.
One huge reason for the strength of the US Dollar, is that it is the global standard currency for buying oil. There's a reason the US uses every trick in the book, and writes a few of their own to keep it this way.
On that note, the USD has likely already gotten a boost from being the dominate crypto-to-fiat pairing on exchanges with an international us...