We do not really know what the Libra project will give, but one thing is already certain: the stir it is causing in the world of regulators is unprecedented. As technical evolution is inexorable, central banks seem to have their backs against the wall: either they accept the circulation of one or more private currencies (and rather one than several, knowing the massive network effect in the monetary field) at the risk of see their own currency challenged, or they get into the race themselves by issuing a central bank digital currency (MNBC). They have two ways of doing this: in direct form where private non-banking agents have a simple current account with the central bank; or in a delegated form where the central bank instructs banks or approved institutions to manage deposits in return for digital accounts. A private digital currency deviates less than one might think from this pattern, at least if we are talking here about "backed" private currencies (or stablecoins in English), which, unlike a Bitcoin which does not is worth only the value that its users lend to it, invest the sums entrusted in monetary assets. For example, Libra places the sums entrusted in a basket of major currencies, including the dollar or the euro. It must therefore be seen that digital currencies, as soon as they are backed, are nothing other than open funds invested in monetary assets that must always guarantee extreme liquidity if they want to play their role as money. The Libra, faced with the more complex task of properly matching assets and liabilities, also strongly resembles an ETF (exchange trading fund), with “resellers” providing liquidity. However, as long as the private currency does not supplant the currency of the country where it circulates – which could be a fear in certain emerging countries – it remains highly dependent on the local banking system. After all, these are dollars or euros that are deposited with operators and that they must place themselves. Today, the regulation obliges them at least to place them with banks. But the central bank can go further: it can largely control the issuance of such currencies by imposing a banking status on private operators and by forcing them to reserve requirements at home. This is exactly what the Bank of China is doing today with the two major Chinese operators, Alipay and WeChat Pay. In doing so, we would have a new class of banks, limited to the function of deposits, what is called narrow banking. Nothing is simple of course: knowing the power and know-how of the big digital players who promote these new currencies, we would see formidable competitors for the traditional banks coming, with the risk of drying up their deposits and therefore slowing down the credit. We understand that central banks do not want to shake up today's financial world too quickly. In any case, we see the end of the road: either a frontal entry of central banks offering their digital currency and arranging among themselves for international transactions, or the peg to the sovereign currency of the country of backed digital currencies issued by institutions closely controlled by them. Strategic error?

Which brings us back to Libra. Wouldn't Facebook be making a great strategic mistake with Libra as it is configured, in addition to the bronca aroused among regulators? PayPal's departure from the Libra consortium is perhaps the harbinger of this. Why invent a new currency, when it could have been limited to a simple digital currency directly tied to the dollar or the euro or, indeed, to any domestic currency? Isn't its primary interest, it is presumed, to transform Whatsapp into a vehicle for payments between individuals and thus to collect, for advertising use, the precious private information that results from it? However, international currencies have never taken off, witness the failure of the SDR or Special Drawing Right, this currency carried by the IMF. The bulk of monetary flows remains domestic, and individuals wishing to make international transactions, migrants, tourists or thugs are happy to accommodate major existing currencies. What interest for an individual to accept the Libra if he must ultimately convert it into his local currency and suffer the exchange risk? Finally, major currencies have a degree of security that is hard to beat. It is easier to see an emerging country admitting the dollar as its internal currency (it is said to be "dollarized") than in the future to be "librized". The Libra project would then have had the only result of stirring up regulators and central banks and pushing them faster than they thought to enter the world of digital currency.