‘Such initiatives will only work if you are backed by the supervisory authorities’
Libra had to become the alternative digital payment method for billions of consumers. On Monday, however, Visa, MasterCard and PayPal dropped out of the Facebook initiative, following strong pressure from supervisory authorities and politicians. According to Mary Pieterse-Bloem, Professor of Financial Markets at Erasmus School of Economics, initiatives such as Facebook’s Libra will only work when supervisory authorities fully support it.
‘They had thought of a lot, but not enough of the cooperation,’ says Pieterse-Bloem. ‘The fact that central banks felt threatened is a factor in this. An alternative form of money simply emerged. Central banks lose their monetary control when a parallel world of money emerges, they cannot let that happen.’