... If they use the fractional reserve, I'm afraid inflation will speed up rapidly and take down the global economy (assumed Libra would become mainstream). Perhaps this situation is good for Bitcoin. People will realize that Bitcoin is the only non-debased currency.
We have to think this through carefully.
Say, the 'consortium' issues too much Libra. By definition, this means the supply of Libra goes up, but its fiat reserves don't go up by the same degree. There is too much Libra chasing goods and services, but not dollars or euro. Inflation would happen within Facebook only. At some point, confidence in Libra will falter, but this problem will be limited to the exchange rate between Libra and fiat. (When Libra holders fear this problem, they will sell Libra for dollars or euro.)
The only scenario where the problem of confidence in Libra becomes a problem for fiat money as well is when central banks decide Libra is 'too big to fail' and bail it out. I don't think that is likely. The Western elites are not stupid. The collapse of Libra will hurt a lot of people, but when the problem can be blamed on Facebook alone, why risk the reputation of fiat currencies to save Facebook?
Can Libra become so big that it really is 'systemically important' and really requires a bail-out by today's Western tradition of keeping voters happy? That is always possible, but I think the Western elites will (correctly) sound the alarm on Libra before that bubble becomes too big, so the bubble can burst and the pain will be limited.
Libra will be a plus for the Western elites, most likely, in the short to medium term.