Facebook Announces Libra Board, Amid Departures

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Dead man walking? Libra announces board, despite being rocked by pull out by five major payments providers

The remaining founding members of the Libra Association have met for the first time in Geneva on Monday, and insisted the cryptocurrency will still launch in 2020.

The optimism comes despite five major payments providers pulling out of the currency, after Mastercard, Visa and eBay withdrew from the Libra Association last Friday, as well as fintech start-up Stripe and payments firm Mercado Pago.

The move follows PayPal’s exit from the association earlier this month, and leaves the project without the backing of any major payments firms.

Libra departures

And on Monday in a further blow, the latest member defection was by online travel company Booking Holding, which operates websites such Booking.com, OpenTable and Kayak.

But the remaining backers of Facebook’s Libra cryptocurrency project pledged to forge ahead, Reuters reported.

They selected a five-member board on Monday, shrugging off the withdrawals and the concern from numerous regulatory bodies.

“It is a correction; it’s not a setback,” Dante Disparte, head of policy and communications for the Libra Association was quoted as saying, while the 21 remaining members held their inaugural meeting in Geneva.

A spokesman for the Libra Association meanwhile told the BBC he believed the currency was still on track to launch next year.

At the Geneva meeting on Monday, the remaining 21 members all confirmed their commitment to the project.

Facebook had announced Libra in June, with plans to launch it by June of next year, but has said the launch date could be pushed back if necessary while negotiations with regulators continue.

Regulatory scrutiny

Libra’s founding 28 members had initially signed non-binding letters of intent to join the project, but some former members told the FT they felt Facebook had hyped up their involvement before they had fully committed.

In the months after Libra’s launch the initial members were beset by inertia, fractures and fear of attracting regulatory attention, some told the paper.

Friday’s departures were prompted by letters to Visa, Mastercard and Stripe from two members of the Senate banking committee, informing them that Libra would mean the companies existing businesses would receive additional regulatory scrutiny, former members told the FT.

The move publicly threatened companies’ entire business models if they “so much as had a Libra node on their servers”, one person reportedly said.

The moves were reportedly further pushed forward by the news that Facebook founder Mark Zuckerberg would be testifying in Congress this month on Libra.

Of Libra’s original 28 members, large companies including Vodafone, Uber and Lyft continue to back the project, as well as non-profit, venture capital and blockchain firms, but no major financial organisations.

The project has been criticised by France, the Bank of England, and the US Federal Reserve chairman Jerome Powell, as well as others.

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Author: Tom Jowitt
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