Robert A. Schwinger
When it comes to digital assets built on blockchain technologies, Washington has been busy in recent months. Federal legislators, regulators and enforcers have been making enforcement pronouncements and new proposals to try to keep up with the social, economic, political and legal issues posed by the issuance, use and trading of these new kinds of assets. Here’s some of what they’ve been up to:
Legislative Responses to Facebook’s ‘Libra’ Project
Facebook’s “Libra” project garnered much attention in recent months both in the press and in Congress. Libra is a proposed “stablecoin,” meaning that it is a cryptocurrency that seeks to minimize price volatility, in contrast to highly volatile cryptocurrencies like Bitcoin. Certain financial institutions have themselves announced plans to issue their own stablecoins with a stable value tied to a national currency like the U.S. dollar. But Libra, as discussed in our September 2019 “Blockchain Law” column, rather than being “pegged” to a single asset like some stablecoins, is intended to be backed by a basket of leading world currencies in assets such as cash bank deposits and highly liquid, short-term government securities, with the stated goal of minimizing the exposure its value might face from fluctuations in a single region.
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