Facebook Libra is a Monopoly Scam, Thinks Roubini

By Prashant Jha

Nouriel Roubini, a leading economist and a well-known critic of Bitcoin, has taken to Twitter again to diss Facebook’s native cryptocurrency Libra. Known as Doctor Doom for frequently criticizing crypto, Roubini has now claimed that Libra is not even a cryptocurrency to begin with. Clearly, this American economist has launched into one of his tirades against crypto again.

According to Roubini, Libra is a blockchain only in name. He believes that Libra has been introduced by Facebook only to maximise its own profits. He has even dubbed the whole project a “monopoly scam” because Facebook has access to several billion users around the world who can be converted into using the service.

He writes on Twitter:

“It will start as a private, permissioned, not-trustless, centralized oligopolistic members-only club. So much for calling it “blockchain”. Like all “enterprise DLT” it is blockchain in name only and an monopoly to extract massive seignorage from billions of users. A monopoly scam.”

Roubini has argued that Libra, being tied to a basket of currencies, will accrue “significant currency risk” for users who live in areas that have more or less stable currencies. He has warned users in the US and European countries to remain careful about Libra being pegged to unstable currencies from emerging markets.

Even though Roubini is believed to be one of the harshest critics of Bitcoin, and often unduly so, many crypto enthusiasts agreed with him on this issue. Facebook’s Libra project has garnered a lot of hype of late, with big shots like Uber, PayPal and MasterCard investing in the Libra consortium. Clearly, Libra is attracting both positive and negative attention of late.