PAYKUN PAYMENT GATEWAY: Facebook's Libra will destroy all stablecoins, transforming commercial and central banks into "dumb regulatory repositories for digital fiat currencies" and ultimately attracting new Bitcoin users. That's according to Arthur Hayes, co-founder and CEO of BitMEX, a leading cryptocurrency trading platform, in his newsletter.

Hayes said, "I have no sympathy for those who naively believe there is value in an obscure sponsor being able to create a blockchain-based fiat currency market fund." He emphasised that Libra is also a stablecoin backed by fiat currency, not cryptocurrency.

He is not the first to predict that Libra could compete with other stablecoins. However, at least Tether, the most popular stablecoin, has previously said it is not worried about losing market share.

Hayes further analyses the impact Libra may have on banking, e-commerce and how Libra could make credit more accessible to online shoppers worldwide.

Here are the key takeaways:Libra won't be an anonymous currency, and requests from government agencies could freeze transactions. Facebook user data could be used to calculate credit scores if Libra decides to issue loans. facebook and other tech companies could issue loans at a lower cost and offer lower interest rates than commercial banks, "but maybe society is trading one devil for another." Facebook has assumed the role of a central bank through Libra, and government officials have been driven to speak out by concerns that the financial services industry could be disrupted. libra won't provide financial privacy, but it is forcing those concerned about the loss of privacy to explore alternatives, such as Bitcoin and other cryptocurrencies.

Hayes summed up the analysis by saying, "Through their investments in augmented and virtual reality, Facebook seems to be looking to create a whole new digital world. libra could be the financial magic of this virtual existence."

Libra, an ETF

Meanwhile, the research team at BitMex takes a slightly different view of Libra, calling it, in an ironic analysis, a "Libra ETF", which stands for exchange-traded fund, a fund that holds a portfolio of other assets on behalf of ETF unitholders. Similarly, Libra would be backed by a variety of other assets, giving each "unit" its value.

However, the analysis points out that the main difference between Libra and ETFs is that Libra holders are not entitled to the income generated by the Libra association's investments.

The research team noted, "While Libra has significant disadvantages compared to traditional ETF products, Facebook's broad consumer reach through platforms such as WhatsApp and Instagram could give Libra a key commercial advantage."

Separately, in an interview with Yahoo Finance, Jamie Dimon, CEO of investment banking giant JPMorgan Chase, questioned whether Libra would "follow banking rules or KYC, BSA, AML, or they won't?" He said, "But they obviously want to serve their customers, and that's fine." He added that he doesn't see cryptocurrencies in general as a threat to JPMorgan's business.

Dimon said, "We will have competitors. Whether it's cryptocurrency competitors or other fintech companies, we're going to have competitors. I tell our employees, don't speculate. You know they're out there. You know they're coming. You know they're trying to steal your lunch. Assume they are there. It may not be the ones we see, but the ones we don't."

In addition, cryptocurrency exchanges seem increasingly inclined to list Libra. for example, major exchange Binance "may want to list" Libra and has already contacted Facebook, Finance Magnates reports, citing exchange strategy officer Gin Chao. Meanwhile, Erik Voorhees, CEO of the ShapeShift trading platform, said "he would love to integrate Libra into ShapeShift while it exists."