Fear not, Facebook’s Libra is good for banks

Facebook’s plans to launch its own cryptocurrency using blockchain has led to the usual ‘traditional banks are dead’ commentaries. However, if the Libra project is successful it will be good for banks.
The real challenge for the Libra project is whether customers have faith in a currency not backed by a central bank. Libra will be backed by assets but its value will be determined by a currency basket. The sting will be if users find that the market has moved against them and the Libra in their Calibra wallets has lost value. For this reason they will want to change their money back and forth into their local currency or dollars and keep it in a bank account.