Despite convertibility issues, Facebook’s Libra will be a dominant stablecoin, opines Thomas Lee

Thomas Lee, Head of Research at Fundstrat Global, spoke to CNBC about Facebook’s Libra Blockchain. He also opined on how it would affect the cryptocurrency space, especially Bitcoin, stablecoins, and the field of decentralized finance.

Lee said that Facebook’s announcement was a “complete validation” of the fact that institutional eyes had shifted to cryptocurrency, contradicting the people who argued that institutions were backing blockchain and not crypto. Lee added,

“It is more targeted at stablecoin and creating a new kind of banking system and it is very complimentary to Bitcoin, so I think this is a very bullish development for Bitcoin and bad for stablecoin and anyone trying to get into decentralized finance.”

In addition to the above, Lee said that other cryptocurrencies including, Gemini and other stablecoins, that Libra is putting at risk, wouldn’t necessarily change the price that much since each of these stablecoins is collateralized.

Further, Lee confirmed,

“Libra is going to be one of the dominant stablecoins, although convertibility is going to be an issue.”

Since Facebook’s Libra Coin is being backed a lot of payment processors like Visa and MasterCard, Lee opined that decentralization for banks [including Facebook’s Libra Coin] would be a “negative return,” but it would be vastly beneficial for payment processors.

Facebook’s Libra caused widespread speculation as to how Facebook’s Libra coin would alter the price of Bitcoin and if it could potentially disrupt and destroy XRP. Moreover, the announcement of Libra coin has caused government authorities in the U.S. and E.U. to question its implications. U.S. authorities have in fact, asked Facebook to put this project on pause until the Congress reviews its development so far.

A Twitter user, @crypto_n_more, commented,

“Tom dont do it, please stop it with the predictions…..not again….”

Another user, @[email protected], commented,

“My gf just yelled “SELL THAT SHIT” from the other room. That’s my girl! ???”

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