European Central Bank’s executive Yves Mersch has branded Facebook Libra’s ecosystem, a private currency unveiled by the social media giant and scheduled for launch in the middle of 2020, as not only complex but cartel-like in structure, advising Europeans to steer clear off the cryptocurrency.

At a speech centered on Libra currency delivered at the ESCB Legal Conference in Frankfurt am Main, today 2 September 2019, Mersch, a member of the Executive Board of the ECB, exclusively spoke on some realities about Facebook’s version of digital currency.

He reflected on how Facebook’s executive presented themselves before legislators across the globe to speak on how they threaten democracies due to the way they handle people’s data on their social media platform.

Is Facebook Libra Different from other private currencies?

Raising observations on the negativity of giving custody of citizen’s money, payments, and global monetary and financial system to unscrupulous privates firms having deceitful past, Mersch said Libra does not differentiate self from other known private currencies, saying the digital asset is to be issued via a public ledger that runs on a blockchain technology.

He, however, noted some dissimilarities which boarders on the complexity and cartel-like nature of the Libra’s ecosystem.

Mentioning the Libra Association, and how the digital currency is to be sold, the financial expert said Facebook’s Libra is highly centralized, especially with Facebook and collaborators on Libra, conferring themselves the position of quasi-sovereign issuers of money.

While emphasising that the sole aim of cryptocurrency is decentralisation, Mersch reflected that Libra is however, an antithesis to the propagated crypto aim. He said Libra is a hallmark of exceedingly high centralization, pointing afterward that Libra’s features inhibit trust and do not present the digital currency as an International lender of last resort, especially during debt crisis.

Libra’s Association a Limited Liability Firm?

Morsch pinned Libra Association, which comprises of bigwigs financial institutions like PayPal, as limited liability.

The ECB executive is concerned about Libra’s claim of a private currency after Facebook said it is going to be a different “sovereign currency-denominated assets”.

Mention Libra’s effect on Europe’s monetary system and ECB’s conclusion on ideas like Libra, Morsch said the digital currency could lower ECB’s authority over the euro, impact ECB’s liquidity position by thwarting its monetary policy transmission model.

While recognizing the legitimate roles of Libra, Morsch said the digital currency could devalue the role of Euro internationally, and cautioned Europeans from falling pray of Facebook’s treacherous promises.