Looking at this as a black box, you buy credits using real money, and you can transfer the credits with less fees than tradition banks. Except you have one extra step on conversion of money into credits.
If there are enough people and places that accepts this credit, you eventually don’t need to ever convert it back to real money. Therefore when there is a lowered chance people would do a bank run, they can lower the backing requirement, like how banks are, and can reinvest the money. Here is the main point, they probably won’t dare issuing coins ie print money as that would immediately could be deemed a national security issue as now you are competing against a nations money supply.
You gonna say, wait, this is how bitcoins work, but nobody is giving bitcoin any respect. This libra thing will get respect, so regulation may just stop it in its tracks as soon as it gets too far.
So this thing is probably not going anywhere fast, in order to be useful, it needs to go beyond America. Every country will be scare of this possibility becoming a currency they have no control over. I’m not even sure if America will allow this to even take off without severe regulations that crippled the development
If there are enough people and places that accepts this credit, you eventually don’t need to ever convert it back to real money. Therefore when there is a lowered chance people would do a bank run, they can lower the backing requirement, like how banks are, and can reinvest the money. Here is the main point, they probably won’t dare issuing coins ie print money as that would immediately could be deemed a national security issue as now you are competing against a nations money supply.
You gonna say, wait, this is how bitcoins work, but nobody is giving bitcoin any respect. This libra thing will get respect, so regulation may just stop it in its tracks as soon as it gets too far.