Facebook’s Libra Association Members Consider Backing Out

  • At least three companies, two of which founding members of Libra, were holding discussions on what their “right next steps” should be.
  • Two unnamed sources have stated that Facebook was becoming unhappy with the lack of support from the Libra Association members.
Facebook's Libra Association Members Consider Backing Out

Several backers of Facebook’s planned Libra cryptocurrency are privately considering withdrawing their support due to the pressure from regulators, the Financial Times reported on 23 August.

According to the report, three companies, two of which are founding members of Facebook’s Libra Association, were holding discussions on what their “right next steps” should be. The two firms were expressing concerns over the regulatory spotlight the project has seen, while the third was worried about publicly supporting the venture as it could draw regulatory attention to their own businesses. One of the founding members said in an interview with the FT:

“I think it’s going to be difficult for partners who want to be seen as in compliance [with their own regulators] to be out there supporting [Libra]”

In mid June, Facebook announced its plans for its Libra project, and established a governance consortium called the Libra Association. The association had been joined by 28 founding members, among which were companies such as Visa, Mastercard, PayPal, Uber and Spotify. And since June Facebook has been under scrutiny, with regulators around the world raising concerns over Libra’s potential threat to financial stability. One of the project’s backers went as far as to say that:

“Some of those conversations [about regulation] should have taken place before the launch, to understand how regulators would think about this, so there wasn’t so much pushback.”

Two unnamed sources that are “close to the project” have stated that Facebook was becoming unhappy with the lack of support from the Libra Association members. One of Libra’s backers said that Facebook was getting “tired of being the only people putting their neck out.”

Both Facebook and the Libra Association reportedly declined to comment when contacted by the FT.

Discussion
Related Coverage
Crypto.com Granted Major Payment Institution License in Singapore
  • Crypto.com has once again expanded its regulatory achievements with the acquisition of a major payment institution license for digital payment token services in Singapore.
  • The license, for which the company received an in-principle approval last June, enables the exchange to provide a greater range of payment services in Singapore.
June 1, 2023, 1:00 PM
crypto.com

Shutterstock

DeSantis Launches Presidential Campaign, Vows to Protect Bitcoin
  • The current governor of Florida, Ron DeSantis, announced he is joining the race for the 47th president of the U.S. during a Twitter Spaces event on Wednesday.
  • During his speech DeSantis declared his support for Bitcoin and the wider crypto space, noting that if Joe Biden is re-elected “they’ll probably end up killing it”.
UAE Starts Accepting Licensing Applications for VASPs
  • All virtual asset service providers (VASPs) in the UAE are now required to submit a licensing application with the Securities and Commodities Authority.
  • Firms that have already acquired a license in the UAE’s financial free zones will be exempted from the requirement, but those in Dubai will still need to apply with the SCA.