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Libra Association Members Backtracking on Commitment to the Cryptocurrency

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October 2, 2019 | 

Darryn Pollock |  0 Comments| 

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The news surrounding Facebook’s much-anticipated cryptocurrency project, Libra, in the past few months has been nothing but negative. Regulators have come down like a ton of bricks on the project with a number of major nations doing all they can to try and sink the project. 

Regulatory pressure has been far more extreme than many would have imagined, beginning with the USA calling Facebook to a Senate hearing to discuss their plans and relay the fact that the company could not create its own currency.

More so, the likes of France and Germany then stepped in to say that Libra was a threat to the national sovereignty of global currencies. However, this has been dispelled by the head of the project, David Marcus, even though it has fallen on deaf ears. 

Facebook has had to state that if they do not get regulatory greenlights across the globe there may not be a launch of the project at all, however, in recent comments, the project has reaffirmed that they are still looking forward to the 2020 launch. 

However, as Facebook now turns to its Libra Association members to reaffirm their commitments to the project, there appears to be a little reluctance from some major names. According to Bloomberg Visa, Mastercard, PayPal and Stripe are unsure whether they wish to become paid-up participants in Facebook’s Libra digital currency.

Unaware of the backlash

It appears that in the leadup to the launch of the project, where there was a lot of excitement and optimism, the Libra association members where assured that the regulatory concerns that could come would be easily handled and not a threat. 

With this transpiring to not be the case, it appears as if some of these major backers are now spooked and not willing to fully commit, and part with $10 million, for a project that may not come to be. 

Executives at the payments companies believe Facebook oversold the extent to which regulators were comfortable with the project and are concerned about the perception that the social network hasn’t behaved responsibly in other areas,” the Bloomberg report reads.

The Association is intended to help both the members, as they have access to the Library network and will be one of the first in this potentially groundbreaking financial advancement, but it is also intended to benefit Facebook and Libra. 

As part of signing on to be a paid-up member, which could happen as soon as 14 October, the companies would have to pay $10 million and act as nodes for the blockchain network which Libra will run on top of.

Stripe says nothing’s changed

With all these rumours circling, there has been some talk out of these companies which seems to dispel the issues, but does not say too much more in relation to the teething problems. A Stripe spokesperson appeared to deny any problems between the company and Facebook, adding:

“Nothing has changed with our involvement with Libra since we came on to participate.”  
 

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