Libra white paper 2.0: what changes have been made to Libra to meet regulatory requirements?

In the latest version of its white paper, published in version 2.0, Libra appears to have conceded ground to regulators, as the bank, which had previously insisted on being a "basket of stable currencies", finally gave up and made clear it would cater to regulatory demands.

The new white paper has the following four key updates:

1. On the basis of multi-currency stable currency, a single currency stable currency will be provided

2. Enhance the security of libra payment system through a strong compliance framework

3. Abandon the future transition to a no-license system while maintaining its key economic attributes

4. Set up a strong protection in Libra reserve

From a basket of stable currencies to a single stable currency

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The Libra association is abandoning its original vision of a global digital currency backed by a basket of national currencies in an effort to placate global regulators. But Libra intends to issue a stable currency in multiple currencies. According to 2.0, the white paper, "our vision is a Libra legal tender in the network to assist and complementary, not competing with them. But share the (monetary) one of the key problems, when Libra network reaches a certain size and Libra tokens (≋ LBR) by the country's widespread use, interfere with the monetary sovereignty and monetary policy. So we will add in Libra network besides ≋ LBR beyond a single stable currency." For example, LibraUSD, LibraEUR,LibraGBP and LibraSGD are bound to us dollars.

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The stability of each single currency would be fully supported by reserves, which would include cash or cash equivalents and very short-term government securities denominated in that currency. Libra says it hopes to work with regulators, central Banks and financial institutions around the world to expand the number of single-currency stabilisers in the Libra network over time. At the same time, according to the rhythm, Libra the stability of the currency (≋ LBR) will not exist, from the single currency that is ≋ LBR will only take the form of bound with fiat.

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2.0 said a white paper, according to Libra "≋ LBR can serve as a kind of effective cross-border settlement as well as a neutral tokens, for those who haven't on the network to create a single currency stability mechanism for individuals and businesses to countries, it is a low volatility of choice."

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Pandering to regulation

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In the new white paper, Libra makes clear that its goal is to establish a system to ensure compliance with applicable laws and regulations. Comprehensive safeguards enable people and businesses to trust the security and integrity of Libra payment systems. Libra institute has absorbed regulatory feedback and continues to develop a comprehensive financial compliance and networkwide risk management framework, as well as strict standards for anti-money laundering (AML), combating terrorist financing (CFT), sanctions compliance and the prevention of illicit activities.

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The Libra network distinguishes four types of participants:

(I) designate a distributor;

(2) virtual asset service provider (" VASPs ", including trading platform and custody wallet)

(iii) VASPs to complete the certification process recognized by the association; As well as

(iv) all other individuals and entities seeking to trade or provide services through the Libra network (unmanaged wallets).

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Remove plans that introduce unlicensed participation

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In another change, the new white paper removed the introduction of unlicensed participation. "Regulatory concerns are put forward for the control range of Libra network - especially need to guard against unknown participants of the control system, and remove the key terms of compliance" according to rhythm after for finishing) content, the white paper, can be seen Libra is assumed in the original paper from a member of the association control the permission of the network, and a clear plan in the next five years to without excessive licensing network. "Libra's idea is to build a model that has the best quality of an unlicensed system but knows who the counterparty is at any given time. That's KYB." The revised white paper also suggested that the new roadmap would be more in line with the regulatory recommendations of the financial action task force, limiting the online behaviour of individuals and unregulated entities. (in June 2019, FATF officially released Libra's guide to cryptographic business, three days after it did so.)

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Erection protection

Libra notes in white paper 2.0 that discussions have been held with regulators on how to deal with extreme situations, particularly how reserves work in stressful situations, and what claims and protections are available to Libra token holders. Libra incorporates strategies based on other systems in the design and structure of the reserve. The reserve will hold assets with very short maturities, low credit risk and high liquidity. It will also maintain a capital cushion.

The white paper address: https://libra.org/en-US/white-paper/? Noredirect = en - US# the introduction

Libra first edition white paperRead Libra, the Facebook cryptocurrency"

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