The controversy surrounding Facebook’s Libra project continues as some of its backers have been trying to distance themselves from it. At least three of its main supporters have met in private to discuss a potential retreat from the project as regulators exert strong resistance, as reported by the Financial Times.
The severe backlash from politicians and the investigation by EU antitrust officials have consistently raised concerns within the Libra Association, causing some of the previously announced supporters to back off. CryptoPotato reported previously that even Facebook itself warned investors that Libra may not come about at all.
Lack of Support for Libra
The Libra Association began with a bang when it was announced in June. Facebook’s project attracted a substantial amount of media attention quickly; however, not all of it was what the backers had expected.
28 members made a non-binding agreement to invest a minimum of $10 million in the project, hoping to create yet another alternative in the global payments market. Those names included giants like Uber, Spotify, MasterCard, and Visa. Vodafone, Spotify, Uber, and others expressed concerns regarding regulatory scrutiny, worrying that their public support of Libra might attract the same attention from regulators to them.
One of the backers stated, “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.”
This lack of support has reportedly embittered Facebook, and a representative said that Facebook was tired of being the only company putting its neck out.
The uncertainty surrounding the project continues to increase after a strong statement was released earlier this month from data protection officials from the US, the UK, the EU, Canada, and Australia. The main concerns were raised over privacy and the potential risks of tax evasion and money laundering.
The lack of specifics on how Libra would operate and protect its users, combined with its speedy launch timeline, brought attention from officials.
Considering other concerns raised previously by politicians, regulators watching closely, and even a G7 “Libra” Task Force, Libra appears to have a long way to go before its potential launch in 2020.