Since Facebook first announced its plan to launch its Libra cryptocurrency, the regulators have expressed concerns over its potential impact on the financial system.
It has been reported that Facebook sent a letter to U.S. senators to address their concerns after Democratic Senator, Mark Warner pleaded that the social media giant leaves the Chinese yuan out of the sovereign currencies supporting Libra.
It has also been reported that Facebook clarified that it is not the body deciding which currencies will be supporting Libra.
Facebook said in its letter, noting that Libra Association is going to be the agency responsible for making the decision:
“Any decision whether to add a new currency to the Libra Reserve would be made based on all the facts and circumstances at the time, including any direct or indirect regulatory restrictions.” Facebook
Facebook also listed currencies that may be selected for the Libra Reserve, with the U.S. dollar, euro, Japanese yen, British pound and the Singapore dollar mentioned in the letter.
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Earlier, David Marcus, the blockchain lead of Facebook, declared that half of the assets supporting Libra will be U.S. dollars, with the remainder in other sovereign currencies as well as low-risk assets.
So, after Facebook announced its cryptocurrency earlier this year, regulators in many countries have been urging the company to put a hold to Libra’s launch until Facebook can address the concerns of regulators.
To answer these growing concerns, Facebook stated that it will not put the global monetary system out of balance. It also said that it will go ahead with the project, and it promised not to launch the cryptocurrency until regulatory issues have been addressed.