Coinbase boss blasts US stance on Facebook’s Libra project

The US government should react to China’s stablecoin project by reconsidering its “ridiculous” response to Facebook’s Libra digital currency. That’s the view of Brian Armstrong, CEO and Co-founder of crypto exchange Coinbase.

“There are many cryptocurrencies, and Libra is just one of them. But the way the US government reacted it's like they almost want to be left behind,” he tweeted.

In a subsequent tweet, Armstrong said: “The way for countries to remain relevant over the long-term and continue to have high economic growth is to invest in science, technology, and innovation. If the government can help here, even better. But first it needs to do no harm.”

He also argued that “innovation often looks counter-intuitive and disruptive,” but “the best first step is often just to stay out of the way.” Governments are often influenced by special interest groups which “will play on fears and try to block innovation here.”

PayPal

PayPal recently pulled out of the Libra Association that is looking to launch Libra. It did not specify what had prompted the decision, stating that it "[remained] supportive of Libra's aspirations" but would now focus on its own core businesses. PayPal was one of the original members of the association, alongside the likes of Visa and Uber.

There has been a huge backlash against the project. US lawmakers have not been the only ones to express concerns about privacy and Facebook’s growing reach, with officials in Germany and France also saying they would bar Libra from their countries.

In a statement, Libra Association said it was aware that attempts to "reconfigure the financial system" would be hard. "Commitment to that mission is more important to us than anything else," it added. "We're better off knowing about this lack of commitment now."

Apple

Armstrong’s views clash with those of Apple CEO Tim Cook. In an interview last week with Les Echos, he commented: “I’m not comfortable with the idea that a private entity can create a modern currency.”

“Currency, like defence, should remain in the hands of states - it’s at the heart of their mission,” he added. “We elect our representatives in order for them to assume the responsibilities of government. Businesses are not elected - they should not encroach on this space.”