Facebook and a host of other high-profile companies have ditched plans to introduce a global digital currency.
The plan announced in June last year was met with a flurry of privacy concerns from internet users and a backlash from regulators who were not keen on the idea.
The companies wanted to hijack payment systems for their own businesses with a private cryptocurrency called Libra.
The idea was to link the value of Libra to real-world hard currency and to manage the system through a blockchain over which no one, including governments, could exert control.
Facebook was the senior partner in the consortium but was joined by several other companies keen to harvest personal and financial data from the digital transactions.
At the outset, the Libra consortium set down a stated ambition “where anyone that follows the rules of the protocol and contributes the right types of resources (eg computing power in the case of a proof-of-work system) can do so.”
Now, the ambitions are more modest.
“Our goal was to establish a collaborative dialogue early in the journey. We have worked with regulators, central bankers, elected officials, and various stakeholders around the world to determine the best way to marry blockchain technology with accepted regulatory frameworks,” the group said in a statement.
“Our objective is for the Libra payment system to integrate smoothly with local monetary and macroprudential policies and complement existing currencies by enabling new functionality, drastically reducing costs, and fostering financial inclusion. The Association has made changes to its initial approach, many of which depart from the approaches taken by other blockchain projects.
“The association’s goal was never to emulate other systems, but rather to leverage the innovative approach of using distributed governance through association members and distributed technology to create an open and trustworthy system.
“By undertaking the difficult work of enhancing traditional financial systems to become programmable, interoperable, and upgradeable, we hope to allow others to leverage our efforts to build innovative but also safe and compliant financial applications that can serve everyone.
“We appreciate the discussions with policymakers around the world who have helped us understand key concerns so that we can integrate actionable improvements into the Libra payment system’s design and into a phased rollout plan.”