Facebook Has Been Having Trouble Selling Libra To US Congress

US lawmakers have now gone through day two of hearings on Facebook’s new cryptocurrency, Libra.

Members of Congress had another opportunity to look into the governance structure of the Libra Organization, which is an independent and purportedly not-for-profit organization based in Switzerland.

The Libra Organization has been tasked with operating the blockchain that’ll power Facebook’s new digital currency. The organization has run into some problems with the US Congress, however. David Marcus, the head of Facebook’s new digital wallet subsidiary, Calibra, had to reiterate repeatedly that even though Facebook created the code and provided the investment to the project so far, it will not hold complete power over Libra. He also reiterated that none of the 100 members would hold more than 1% of Libra. Unfortunately for Marcus, many in Congress are looking at a 100-member organization which was created by Facebook, and they have a hard time not being highly suspicious.

While Marcus handled a great many questions, it was the distinction between Facebook, Libra, and Calibra that provided him with the strongest shield to work with. The hearing saw Marcus answer questions on many different topics, including privacy, consumer protection, and censorship. Rep. Alexandria Ocasio-Cortez pushed a bit harder, asking if the organization’s members were democratically elected, which Marcus answered with a “no,” but he maintained that it would have “proper regulatory oversight.” Cortez continued “We are discussing a currency controlled by an un-democratically selected coalition of largely massive corporations… So who picked the founding members of this governance over the currency?”

The Libra association is made up of several financial heavyweights, including PayPal, where Marcus previously worked. The other companies include Visa, MasterCard, Uber, Lyft, Stripe, eBay, and several other startups, non-profits, and venture capital investors.

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5 years ago