A jury of Swiss financial experts opted for «Libra» as the financial word of 2019. The vote was organized by finews.ch and Migros Bank and was based on more than 250 suggestions sent in by readers.
finews.ch, the German-speaking financial website published by the same company as finews.com, and Migros Bank, the commercial bank wholly owned by Switzerland’s largest retailer, each year select a financial word of the year.
The jury (pictured below) that included Michael Theurillat, an author, Adriano B. Lucatelli, a fintech entrepreneur, Sita Mazumder, a professor of finance, Thomas Pentsy, market analyst at Migros Bank and Claude Baumann, CEO of finews.ch, selected «Libra» as the financial word of the year 2019.
Swift and Easy Transactions Across Borders
The idea behind Libra is straightforward: a global digital currency for everyone with access to a smartphone or PC. Libra will enable swift and cheap transactions across borders, making online shopping easier and more cost-efficient.
The new currency is based on the Blockchain technology. Libra, unlike other cryptocurrencies, is designed as a stable coin, backed up by a currency basket that will lend Libra more stability. So instead of fluctuating wildly as Bitcoin, Libra is expected to be a currency that doesn’t move that much.
Underlying Currency Basket
The currency basket will likely contain the U.S. dollar, the euro, pound sterling and the Singapore dollar. The basket will be increased in volume in line with the issuance of each Libra, keeping the balance between the cryptocurrency and the currency basket.
The project organizer, a foundation called Libra Association, plans to launch the digital currency in 2020. Facebook is the company sponsoring the currency experiment.
Huge Potential
The idea of a global digital currency has the potential to succeed in the market. «The number of potential users is enormous,» said Thomas Pentsy, an analyst at Migros Bank.
Facebook, the driving force behind the Libra project, has two billion people signed up. The Libra promoters plan to give access to financial services to the 1.7 billion people in developing countries who don’t currently have a bank account or other means to make non-cash transactions.
«Libra clearly is a challenge for the existing monetary system,» said Claude Baumann, chief executive of finews.ch.
Backers That Pulled Out
Politicians, regulators, central banks and commercial banks all have voiced their reservations about the Libra project. They are concerned that the cryptocurrency may lead to an upheaval on the currency markets.
The pressure from politics and regulators has already prompted companies including Visa, Mastercard and PayPal to pull out of the project. These companies were key to the credibility of the project.
The selection of a financial word of the year took place for the sixth time, sponsored by finews.ch and Migros Bank. The jury evaluated more than 250 suggestions. Previous words of the year included Bitcoin and negative interest.
