Facebook’s planned introduction of its Libra cryptocurrency is facing opposition on all sides that an actual launch by year 2020 could be stalled. As it is, U.S. legislators, financial regulators and government officials not only in the U.S. but also in EU countries are wary that a payment processing system running on blockchain technology and operated by Facebook, presents serious concerns and issues.
Lawmakers cannot accept the social media company’s motives at face value, since the Libra business model when combined with the Facebook social site is regarded as much too invasive over users’ private information. In enticing FB denizens to use the Libra cryptocurrency, Facebook will likewise gain access to credit card, bank account and ewallet data as well.
After all, the main problem with Mark Zuckerberg’s social media company is the laxity by which they have been handling data entrusted to them by millions of users. Legislators on both political sides insist that for them to allow the rollout of Libra cryptocurrency and its blockchain platform, Libra operators must do so under strict government oversight and regulations.
House Representative Maxine Waters, who chairs the House Financial Services Committee cited Libra’s potential use as medium for carrying out money laundering transactions and other illegal financial activities. She also demands Mark Zuckerberg’s appearance before her and in her committee hearings. That way, Zuckenberg will provide clear and definite testimonies on how his newly formed subsidiary Calibra, intends to address all issues being raised against the Libra cryptocurrency project.
Although Facebook claims that Libra cryptocurrency operations will run under the governance of the Libra Association, it does not serve as a guarantee that all issues raised against the cryptocurrency project will be effectively addressed. After all, the Libra Association represents about 28 multinationals and non-profit organizations that will contribute $10 million or £8 million dollars each before one becomes an official Libra Associate.
Obviously, they are first and foremost investors whose interest in providing financial backing is to profit from Libra’s future cryptocurrency operations.
Financial Backers of Facebook’s Libra Project Led by PayPal, Showing Signs of Withdrawing Commitment
PayPal has already pulled out from its Libra-partnership commitment, while representatives of credit card companies Mastercard and Visa are set to meet on October 14, to finalize decisions on whether or not they will become official members of the Libra Association. More companies who had signed letters of intent to provide support as a Libra Associate, are reportedly having doubts about finalizing plans to join Facebook’s Libra project.
Apparently, commitments are being shaken by the growing opposition and potential regulatory problems; especially if EU countries like Germany and France will block the Libra digital money should it move forward. Both countries issued a joint statement conveying that
”no private company must claim the right to have monetary power that belongs inherently to the sovereignty of nations.”