The world is taking a path that has not been passed: The President of the United States does not support Facebook Libra, is it true?

Introduction

On July 11, 2019, US President Trump made a speech on Libra on Twitter, sparking some heated discussions. Later, many people published articles that he opposed Libra and that the views were consistent with the opposition of the Congress. From his Twitter content, it seems that there is a negative sentence, but if you think that he is against Libra by this sentence alone, it may not be enough to understand the political ecology of the United States.

Every few years, the US Congress has a strong controversy with the president. Congress does not approve the government budget, and the government has to stop. But after the lockout, Congress will finally agree with the White House and the government will continue to open the door. Because there are too many public disputes like this, everyone thinks that this is American political culture, or a political soap series (that is, the boring but lengthy TV drama in the US, which is a TV series for people who clean up the kitchen and bedroom at home, so it is called Soap opera), because Congress will definitely reach a consensus with the president at the end, and will not let the government close forever. Does the president accuse Facebook of being like the controversy of the US president and Congress?

We can't just judge the development of things by just reading the words of the president or the members of the parliament. Today’s President of the United States was originally a famous businessman. In his eyes, only the interests of the United States, the other is not important. So we only need to see if the stable currency of Facebook is good or bad for the United States? If it is good, the US president must support it. Don't forget, Facebook has been discussing the White Paper with the US government and the central bank for a while. If the US government objected, the Facebook project had already been vetoed by the US government during the discussion, and even the mention was impossible. Facebook can present a white paper on June 18th on behalf of the US government.

This time, the US President’s Twitter and the US Congress’s hearings are actually a very exciting series, and many insiders that were previously unpublished are also open, as discussed in Sections 6 and 7 of this article. I used to talk privately, this time it is openly said. Facebook directly said that this is the reform of the world currency. Americans will not do it, and other countries will certainly do it. In this case, the United States should do it first. Isn't this publicly indicating that they all think this is the new currency competition? This explicit statement confirms many people's previous predictions and analysis.

And this time it was a real reform, the reaction of many central banks and the reaction of some banks were historical comments. For example, this time it is a business plan of a US (non-bank) company, and said that it will not engage in banking business, but many bank presidents will say that this will affect the future of their banks. The author has long used the "land of the military to fight" to describe such a plan. If even the central banks of other countries know the meaning of this matter, Facebook will not know? The US government will not know? The US President will not know? The US National Association does not know? They all know, so this is a soap series, to show it to everyone.

I. English original and translation

First let's look at his original text.

"I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air. Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity. similar, Facebook Libra's " If the currency and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations just like other Banks, both National and International. We have only one real Currency in the USA, and it is stronger than ever, both dependable and reliable. It is by far the most dominant currency anywhere in the World, and it will always stay that way. It is called the United States Dollar."

translation

I am not a fan of Bitcoin and other cryptocurrencies, and bits and other cryptocurrencies are not money, and their value is due to "thin air" and has been violently beating. These unregulated cryptocurrencies also support Legal acts include drug trafficking and other illegal activities.

Similarly, Facebook's Libra virtual currency has no status or reliability. If Facebook or other companies want to become a bank, they must seek a new bank charter and must be regulated by bank regulations, as do other banks, including US and international banking regulations.

We have only one currency in the United States, and this currency is a strong currency, stronger than ever, reliable and trustworthy, the world's strongest currency, and the currency will be strong in the future. This currency is the US dollar.

Second, surface analysis

His words below are not controversial:

  • He does not support digital tokens such as Bitcoin, and believes that these tokens have no value, and these tokens support illegal activities;
  • The United States can only support the US dollar as a legal currency, and believes that the US dollar is an international strong currency. In fact, indeed, the share of the US dollar in the foreign exchange market is much more than the share of other countries’ legal currency;

But because "the same, Facebook's Libra virtual currency has no status or reliability," many commentators believe that the US president does not support Facebook's stable currency. Many foreign reports directly say that the US president is against Facebook, and the same is true in China. Their ideas are as follows:

  • · The President of the United States opposes Bitcoin and other cryptocurrencies;
  • · Facebook Libra is also a cryptocurrency, and it has no status and is not reliable;
  • · The US only recognizes the US dollar as a legal currency, and Libra is not.

Third, a deep analysis

At the time, when I received this information, the first impression was also true. But there are people who have worked in the US government for many years to visit, and I will show this information to him. After he finished reading, he directly said that the US president supports Facebook!

He said that these words were mainly said to the Democratic Party yesterday. This is his conclusion to President Twitter: "You can make a Democratic Party, but you must not overdo it. This plan is to be killed in Congress. This plan is good for the United States. You can make trouble, but you have to be measured and you can't let this plan be killed because I support this plan!"

A friend said that US President Trump is the first in the world to use Twitter to make speeches for political layout. Twitter's words are limited, so each word contains a high amount of gold (the US version of Lu's Spring and Autumn), but it can't be said too well, because there are so many people watching this Twitter, including foreign governments and central banks. He wrote Twitter after the discussion by the White House think tank. Every sentence may have different interpretations for different people. The parties can use these words as support for their opinions, even if the views of the parties are very different or even complete. Opposite view.

First of all, who is he writing to Twitter this time?

1. Members of the US Congress, especially Democrats (warn you, don't overdo it!); 2. Members of the US Congress and the US government (please support, I am on the same line with you!); 3. European Government and Central Bank (I will criticize Facebook first, Facebook will definitely solve your problems);

4. American media and ordinary people (I criticized Facebook first, Facebook is not afraid to sell you);

5. Other countries and peoples of the world (I criticized Facebook first).

  • If the US president wants to end the Facebook Stabilization Coin project, he doesn't have to write Twitter at all. There are already many members of Congress who openly oppose it (and many European governments and central banks also oppose it). He just wants the White House assistant to ask Congress to support Facebook. Members can't do anything, or they can say nothing.
  • He accused Facebook of a stable currency that has no status and is not reliable. It is obvious to domestic opponents and foreign governments and central banks that they support their views and understand their positions. If he objects, does he need to write these words for these people? Since they are all in the same position, it is better to stop Libra. It is best not to speak and let the Democratic Party of Congress take it. He doesn't need to publish Twitter to fight Facebook. After the Facebook project was rejected by the National Assembly, if there is a support person to protest, it is said that the Democratic Party is doing it, and the responsibility is not my President! Of course, the European government and the central bank will also thank the president for taking care of this matter and helping them once. It is now obvious that he is not writing Twitter to oppose Facebook.
  • Then why does Facebook say that there is no status? Note that he does not say "no status" but "no status" (English is little standing). Of course, there is no status, because the real status is the dollar. The stable currency of Facebook is the assistant of the US dollar, and there is a dollar to stabilize the coin. No status, but still a bit of status, understand? The author takes a group of dogs as an example, showing the relationship between legal and stable coins. The legal currency is the boss and the stable currency is the younger brother. In the face of the boss, these stable coins have no status.
  • Then why does it seem to be very negative? Because the domestic and foreign governments, the media, and the public opinion circles are too loud, they must give them face, so first hit the two faces of Facebook and say. Especially for the European government and the central bank, the US president must give them face this time. Why? If the European government and the central bank really do not allow Libra to enter Europe, then the US financial weapon – Facebook stable currency, can not enter Europe, it is not a pity! This is a great opportunity to fight against the euro. The president will not know that the White House aides will not know that everyone is pretending to be dissatisfied with Facebook.
  • If the US president and Facebook are in the same congressional hearing, on Twitter, this is a new currency competition. The European government and the central bank promised to close Facebook, so the Facebook plan will not reach its original goal.

But there are two contradictory things to discuss:

1. Facebook clearly stated that they are not banks, do not provide banking services, but the president said they want to apply for a banking license; 2. The status of Facebook's stable currency needs to be studied.

Fourth, is Facebook a bank?

Facebook does not recognize the need to become a bank, and believes that they are not banks, do not provide banking services, and if they need banking services, they will cooperate with banks or financial companies. But the president said, "If Facebook or other companies want to become a bank, they must seek a new bank charter and must be regulated by bank regulations, like other banks, including US and international regulations." How do you explain this sentence? If Facebook is to become a bank, applying for a banking license must be regulated like a bank.

If you want to supervise Facebook, what does this mean? Said to support Facebook to open a bank! This is a strong support for Facebook to become a US bank and is also encouraged to become an international bank. He did not ask if this would become a bank, but said that since he wants to become an actual digital bank, he is righteous, apply for a US banking license, and since he wants to become an international bank, he also applies for an international banking license.

This point was put forward by the author in August 2018. The stable currency is not only a cryptocurrency, but also a digital legal currency, and the stable currency project party is a digital bank. This point was also publicly agreed by the International Monetary Fund (IMF) in May 2019. Now President Trump said directly, open a bank and apply for a license!

5. What is the status of Facebook?

Why do you start with Bitcoin first, so that you can't post the stable currency after the book is finished, and finally say that the US dollar is lofty. It is very natural for the United States not to accept bitcoin, but why should we compare the stable coins of Facebook with Bitcoin?

Is the stable currency of Facebook today good or bad for the United States? Obviously good for the United States, because it can continue the hegemony of the dollar,

Facebook Marcus (David, Marcus) understands at the congressional hearing that this is a bullish for the United States. If the United States does not do it, other countries will do it. Whoever is the boss first, so the United States must first do. This is consistent with the author's article in August 2018.

Then why do you accuse the Facebook stable currency of being unreliable and having no status? Because in his eyes only the dollar has a real status, and the status of Facebook's stable currency is based on the dollar. What he meant was that he had left the dollar, and the stable currency had no value. But in the end, there is no value in the stable currency of Facebook. Otherwise, why should you apply for a bank license on Facebook?

The stable currency of Facebook is not from the "thin air", but a digital currency supported by a basket of financial assets. Each stable currency needs to be purchased and guaranteed by the currency. The president did not say that Facebook coins came out of "thin air," he just said that the status is not good enough and not reliable enough. These are normal, Facebook stable coins are still under development, of course not reliable.

Cover

Six, Facebook confirms world currency competition

Facebook stable currency brings digital currency competition. The author describes this situation with “currency hegemony”, and some foreign analysts have reached the same conclusion. This concept was later agreed by analysts, but Facebook's hearing was directly publicly confirmed.

Markus, head of the Facebook blockchain project, said: "I am excited about the potential of Libra. I am proud of Facebook's efforts in the US. I believe that if the United States does not lead innovation in the digital currency and payments, other countries Yes. If we don't take action, we may soon see a digital currency that is controlled by people with very different values."

This means that today's Facebook is not done, other countries or teams will do it. If they succeed, the world currency outcome will not be controlled by the United States, but by other countries or teams. This is good or bad for the United States. very obvious. If it is the United States and its group, the Facebook team is a very good choice. This view is also the concept put forward by the author in the August 2018 article.

The emergence of large-scale stable coins will affect the national currency, the central bank, and commercial banks. Facebook's white paper on June 18 shocked many central banks, big banks, and companies in many countries. But this has long been predicted. When Facebook had not announced the white paper in early 2019, many analysts and authors predicted that this would be an earth-shattering thing.

In the early 2019, the author's article described the importance of this matter as "the place where the military is competing." At the end of 2018, the "aircraft carrier is already on the Bund" described the urgency of this matter. But for the author, July 2018 was the most surprising. On that day, IBM announced that it would issue stable coins. This day is also an important day in the history of world currency. Because Facebook's things will happen in the future, if not Facebook, it will be launched by other high-tech companies.

Seven, Facebook hearing confirmed that this is to compete with Alipay and WeChat

Libra is a payment tool. When asked about the relationship with Alipay and WeChat payment at the hearing, Facebook host is open to competition. This confirms the author's point of view before the Facebook white paper has not yet come out:

"Recently, insiders revealed that this is a huge commercial competition. The foreign blockchain tigers are supported by the consortium and are ready to take the lead in the future of the world financial industry."

In fact, not only Alipay and WeChat, Facebook's stable currency will compete with many payment companies in the world, and this Facebook competition is a corps battle, not a single fight, because the world famous payment companies such as Visa, Mastercard, PayPal, etc. Work together, rather than come out and compete separately with Alipay and WeChat.

Eight, the benefits of Facebook's stable currency to the United States

At the hearing, Patrick McHenry, vice chairman of the US House Financial Services Committee, delivered the opening speech of this hearing: "Washington must avoid becoming a place to stifle innovation, and we must not ban because we cannot understand technological innovation for the time being. In fact, today It’s not Facebook, the change has arrived, the blockchain technology is real, and Facebook’s entry into this new world just confirms this fact. Nakamoto’s bitcoin is an unstoppable force, and we should not stop it. Innovation, the government can not stop this innovation."

The biggest significance of Facebook's stable currency is also the homework of many central banks, commercial banks, technology companies and merchants in the past month: the blockchain brings the biggest financial innovation and financial market changes in 500 years. The Federal Reserve, the European Central Bank, the Bank of France, the Bank of England, the Bundesbank, the Reserve Bank of Australia, the People's Bank of China, the Swiss National Bank and so on have all expressed their concerns. All of a sudden, the world has opened more than a hundred stable currency projects.

Many people know the blockchain because of bitcoin, but because bitcoin sees the blockchain, many economists and bankers criticize the blockchain and think that there is no value. The blockchain will only disrupt the financial market. They did not see that the main financial sector in foreign countries had entered the blockchain in large numbers in 2018, and opened the blockchain financial application. Facebook is just one of many blockchain financial projects.

In September 2017, the chairman of the International Monetary Fund has loudly demanded that central banks need to develop digital legal currency immediately, indicating that a lot of subversion has begun. Is her joke? In June 2019, the Facebook incident said that her words were sharp!

Originally, stable currency was an orphan in the world financial community. Many people used to say that stable currency is useless (only digital tokens that can appreciate value are valuable), but those digital tokens do not shake the world central bank, but the price of stable face paper money shakes. world. In the past, the author has always described the importance of stabilizing coins as "the place where the military is competing." A country's digital economy has no stable currency. Just as Zhuge Liang first went to the city to attack the city but did not hold the street pavilion, the whole army was defeated. The author described it as an aircraft carrier to express its position in digital finance. There is no stable currency like the navy does not carry aircraft. The aircraft carrier is only the "sea" army.

According to the information received now, Facebook's stable currency has the following effects:

  • Affecting many central banks in the world, they have introduced blockchain policies to encourage central banks and private parties to issue stable currencies (digital legal currency), and central banks of weak countries are worried that their legal currency will be marginalized;
  • Affecting the world's cross-border transactions, from the current SWIFT architecture to a cross-border blockchain payment platform, the United States has already participated in five projects, and this number will increase;
  • Affecting the operation of world commercial banks, some transaction banks or trade bank revenues may be greatly affected, including US domestic banks;
  • Affect the merchants, whether they want to accept Facebook coins, or to send their own stable coins to compete. Accepting the agreement that Facebook must obey the face book currency;
  • The cross-border payment of ordinary people no longer goes to the bank, and the use of stable currency, life changes;
  • Affecting other business activities, such as digital stocks;

Patrick McHenry is right, the change has come, we don't understand that it doesn't matter, this change has come. The US president cannot possibly not know. The United States took the first step in the world, confirmed their sensitivity to new technologies, and used this technology to lead the world to the digital economy again on the new business model.

Cai Weide Beihang Digital Society and Blockchain Laboratory, Tiande Technology, National Big Data (Guizhou) Comprehensive Experimental Zone Blockchain Internet Lab, Tianmin (Qingdao) International Sandbox Research Institute, CCID (Qingdao) Blockchain Research Institute, China Asia Economic Development Association Blockchain Industry Professional Committee, key project leader of the Ministry of Science and Technology, Beijing Internet Finance Association blockchain special committee