PayPal has officially withdrawn its participation in Facebook’s Libra cryptocurrency while Mastercard and Visa have clarified that their participation is provisional providing that Libra and “the association [can] satisfy all the requisite regulatory requirements”.
Technically, Facebook is no more than just one of the 28, now 27, participants in the Libra project with Facebook’s Calibra subsidiary leading the project to actually create a cryptocurrency. However, the project launched with a lot of news due to the “participation” by many big payment names including PayPal, Mastercard, and Visa, which has now softened. PayPal officially said that their decision to leave was “to focus on advancing [their] existing mission and business priorities as [they] strive to democratise access to financial services for underserved populations”, but it also comes as more governments are increasingly emphasizing its need to maintain financial compliance.
The French government has been the most vocal about preventing the development of the Libra project with the French finance minister, Bruno Le Mair, saying that “[t]he monetary sovereignty of countries is at stake from a possible privatisation of money”. Other governments have called for hearings to investigate the Libra project and want to ensure it is under government oversight.
Reminder of centralized challenges to government money
The swift government criticism brings back memory of the pre-Bitcoin days when some attempted more centralized alternatives to government fiat, but were swiftly shut down by their own governments. Two of the most prominent independent money systems that met government opposition was e-gold and Liberty Reserve since they offered alternatives to the mainstream fiat-banking channels. Both of these ultimately had to shut down their services since they operated with centralized offices and servers that both government officials and hackers could target.
The government pressure that is appearing to already cause members of the Libra association such as PayPal to get cold feet is a reminder of how centralized challenges to the centralized government fiat-banking system has a very low chance of success. Those that simply play within the system have a higher probability of success, such as the upcoming Apple Card, but this is simply a branded credit card with Mastercard and abides by all the current regulation rules and does not offer much innovation for consumers.
Dash offers transparency while staying decentralized
While payments systems such as PayPal and Libra may suffer from challenges related to centralization, Dash’s decentralized infrastructure removes these barriers. Dash is striving to become digital cash used around the world and is mainly striving to achieve that by offering lightning quick transactions that take under two seconds and cost less than a penny. In addition, Dash offers consumers even greater privacy through its PrivateSend feature, but without falling into a different regulatory category, as Ryan Taylor argues. All of Dash’s transactions are available on the public blockchain along with information about its Treasury cycle votes. This is all accomplished by keeping Dash decentralized, between miners and masternodes, and arguably more decentralized than other top coins, offering consumers the benefits of an alternative to government fiat, it does so with transparency and compliance through third parties, such as BlockchainIntel, but also remains decentralized and more robust against government clampdowns and/or intimidation.