After my presentation at New York Venture Summit about Leondrino on July 10, 2019 and after the publication of a Glen Sarvady podcast mentioning Leondrino as one of the three most intriguing FinTech companies ( → you can listen to it here), I was asked to share the slide I was using about Leondrino concept in comparison to Libra. Triggered by those requests, I provide you the slide and will explain the most important differences between Leondrino and Libra.
The people and organizations behind both concepts share the vision of a global financial infrastructure that empowers billions of people and will be accessible to anybody. Both want to exploit experience of the latest blockchain technology and are committed to switch to public blockchain when this new technology is ready for the mass market and meets the complex requirements in financial services.
But there are key differences:
At Leondrino, we follow a concept of competing private currencies of enterprises that even might have different monetary policies instead of restricting to one global currency only. The Leondrino concept makes it possible that the monetary policy of a health care currency could, for instance, strengthen the value keeping in contrast to a policy of a consumer goods currency that does foster more consumption. Competing digital currencies should all get the same chance to be used at the point of sale, if they are accepted by the consumers and if they meet transparent quality standards which have to be in sync with the requirements of the legal system where those currencies are issued. Of course, avoiding money laundry, human trafficking and terror financing are key requirements which can not be compromised.
We do not believe that a further concentration of currencies to only one global currency will make the global financial system more stable. In contrast to Libra and in sync with thoughts of Professor Friedrich August von Hayek, we are convinced that new technology will make real competition between private currencies possible if the exchange fees between those currencies go substantially down close to zero. And we are not convinced that the world is already mature enough for only one global currency with one governance organization. We rather believe that the introduction of digital currencies of private organizations is more realistic when it is governed by companies or consortia based in one of the existing economic zones with their specific political and legal environment. Therefore, we offer licenses of the Leondrino platform to companies and consortia in different legal spheres and are committed to upcoming open and global standards to enable competition, cooperation and exchange of different digital currencies at the same time.
Another key difference is that enterprises, as the contract partners of a Leondrino licensee, have to sign an acceptance obligation for their associated currency. It means that such a currency has to be accepted in exchange for the products and services of the associated enterprise (can be also a group of companies). Libra does not have an acceptance obligation according to our current knowledge.
The acceptance obligation of enterprises supports the trust building into Leondrino currencies, in addition to the elastic supply management executed by the responsible monetary board supported by the Leondrino algorithm based on economic parameters. The goal of both concepts is to keep the value of currencies relatively stable to foster its role for payment. Stableness in the context of Leondrino is measured related to a basket of products and services of the enterprise. This is different to the current understanding of stable currencies which are related to one Fiat currency or a group of Fiat currencies.
We will follow carefully further announcements and potential adjustments of the Libra strategy. We will share with you our observations and compare it with our Leondrino concept.
For more details of the Leondrino concept please follow us on https://medium.com/@LeondrinoNews.
Originally published at https://medium.com on July 18, 2019.
