Facebook Moves Forward with Libra Despite Many Concerns

Despite severe backlash, social media giant Facebook has decided to launch its cryptocurrency project Libra anyway.

The company moved forward with its plans this week to create the new digital currency.

It was on Monday that the Libra Association, the nonprofit that will govern the currency, officially signed on 21 charter members at the organization’s inaugural meeting in Geneva.

There had originally been 27 potential members but many dropped out including PayPal, Mastercard, and Visa. Many of the remaining members are venture capital firms but there are also big companies such as Uber, Lyft and Spotify on board.

Libra is being created as a legally separate entity through the Libra Association and Facebook will not own it itself.

The association elected Facebook executive David Marcus, the co-creator of Libra, as one of the association’s five directors.

Facebook’s Chief Executive Mark Zuckerberg is expected to appear in front of the House Financial Services Committee later this month to discuss Libra. This may be problematic for the CEO considering that the committee is chaired by Democratic Rep. Maxine Waters, who has been against Libra.

In June Waters had said, “Given the company’s troubled past, I am requesting that Facebook agree to a moratorium on any movement forward on developing a cryptocurrency until Congress and regulators have the opportunity to examine these issues and take action.”

Senator Sherrod Brown tweeted, “Facebook is already too big and too powerful, and it has used that power to exploit users’ data without protecting their privacy. We cannot allow Facebook to run a risky new cryptocurrency out of a Swiss bank account without oversight”

It was also this past summer that President Trump tweeted, “I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air.

Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity….”

In another tweet he wrote, “….Similarly, Facebook Libra’s “virtual currency” will have little standing or dependability. If Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks, both National…”

Disclaimer: We have no position in Facebook, Inc. Common Stock (NASDAQ: FB) and have not been compensated for this article.