Reserve Bank of Australia chief Philip Lowe told participants in a Q&A session June 20th that he does not expect Facebook’s new Libra cryptocurrency network to be fully implemented any time soon.
“There’s a lot of water under the bridge before Facebook’s proposal becomes something we’re using all the time.”
Bloomberg reports that Lowe made the comments following a speech (“The Labour Market and Spare Capacity”) he gave at a Committee for Economic Development of Australia (CEDA) event in Adelaide.
Lowe said that a number of regulatory hurdles must be overcome before the powerful social media network can legally offer a cryptocurrency-based payments option to its 2.4 billion users:
“There are a lot of regulatory issues that need to be addressed and they’ve got to make sure there’s a solid business case, so we’ve got to be careful before we jump to conclusions.”
Facebook has been working more or less in secrecy for months developing its answer to the cryptocurrency phenomenon and to widely-used payment networks tied into Chinese behemoths WeChat and Alibaba.
Facebook appears to have focussed mainly on recruiting technicians for the Libra project. Rumours of compliance specialists procured have only come later.
A number of politicians, both in America and abroad, have also been stating emphatically that Facebook will be held to established standards for payments and banking, comments that suggest Facebook has not yet worked closely with regulators.
Yahoo also reported today that tech and government interests appear to be more closely aligned in China, and Facebook’s Libra could go the way of Apple Pay, adoption of which has more or less been supplanted by the “western” public’s preference for tap-and-go contactless cards.
According to Tim Spenny, a senior vice president at market researcher at Magid who has consulted for Facebook and Visa, “Advanced payment methods haven’t really taken hold unless they’re mandated.”
Governor Lowe is known for having no particular love for Bitcoin, and he criticized it back in 2017.
“When thought of purely as a payment instrument, it seems more likely to be attractive to those who want to make transactions in the black or illegal economy, rather than everyday transactions,” Lowe stated in a speech delivered in Sydney in December 2017, just before the price of one Bitcoin peaked at $20 000 USD.
“The current fascination with these currencies feels more like speculative mania than it has to do with their use as an efficient and convenient form of electronic payment,” he said.
Lowe hasn’t changed his mind that much, given additional comments he made this year on June 20th in Adelaide:
“I have long thought that a kind of cryptocurrency would not take off in Australia because we already have a very, very efficient electronic payments system that allows anyone of us to make bank payments to another person in five seconds just knowing their mobile phone number.”