Ex-IMF Adviser Compares Libra with US Clearing Certificates
The former adviser to the International Monetary Fund (IMF) Barry Eichengreen criticized the Facebook cryptocurrency project. In his opinion, the anti-crisis tools used in Libra have proven ineffective over a century ago.
Eichengreen compared the Libra emergency protection fund with clearing certificates that were actively used in the USA more than 100 years ago. U.S. financiers abandoned this method of bankruptcy prevention and created the Federal Reserve System (FRS) back in 1913.
The main disadvantage of clearing certificates was the fact “not every dollar was as good as every other dollar”. Eichengreen thinks the Libra project can go the same way.
The fact is that the whitepaper Libra states that network operators have the right to limit the withdrawal of funds that are in the reserve fund. Moreover, they can physically prohibit this and make additional commissions so to avoid a shortage of reserve assets.
Barry Eichengreen was an IMF Senior Advisor over twenty years ago. He does not consider Libra to be a threat to the state sovereignty of the United States or EU countries.
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