Members of Facebook's 'Crypto Mafia' Reportedly Getting Cold Feet About Libra Currency

At least three of the 28 entities that have signed on for Facebook's planned Libra currency are now getting nervous about the project, according to a new report from the Financial Times. And Facebook is just as worried about being the only company currently with its "neck out," as regulators push back against the plan to create a new digital currency from thin air. From a report: The companies, which some have dubbed the "crypto mafia," include heavy hitters from Silicon Valley and Wall Street, like Uber, Spotify, Visa, and Mastercard. They're all partners in the Libra Association, a new organization based in Switzerland that is coming under scrutiny from governments around the world. The Chair of the U.S. Federal Reserve, EU antitrust regulators, the French Finance Minister, the Senate Banking Committee, the House Committee on Financial Services, and the Secretary of the U.S Treasury have all expressed doubts about Libra, so it's easy to see why some companies might be getting cold feet. But these companies aren't just worried about Libra's future as a digital currency. Their main concern seems to be that government regulators may want to look deeper into each company's primary business after they're done tearing Libra to shreds.

what could possibly go wrong?

[Geoffrey.landis]

Sure, having one of the most powerful companies in the world decide that they will control the money supply... what could possibly go wrong?

Re:

[bill_mcgonigle]

Yeah, they might use that power to pay for a drone assassination strategy to support a genocide in Yemen if nobody is paying attention. Pretty soon Facebook will have military bases in a hundred countries.

Hint: Facebook's power is trivial compared to the issuer of the current world reserve currency, the US Petrodollar. It's always a bad idea to have a dominant military issue the currency, and this consortium offers a potential way out. Not the best of all possible options, granted, but the world is tire

Re:what could possibly go wrong?

[thereddaikon]

There are very good reasons why corporations shouldn't be allowed that level of power. And it has nothing to do with your conspiracy theory. Ever heard of the east india tea company? They owned India at one point, had a standing army and navy and all of the trappings of a tin pot dictatorship. They were also not directly accountable to anyone in their fiefdom. That is until it all went to hell in the sepoy uprising of course. And that is just one of many reasons you don't let corporations get too powerful. The other ones should be obvious.

Re:

[badboy_tw2002]

You mean the Federal Reserve?

Re:

[infolation]

Because FB's Libra partners are starting to understand FB's real aims for Libra, and they're not about money.

UCL (University College London) just published a report "Libra: Is It Really About Money?" [arxiv.org] arguing that Libra is really a Facebook authentication and identity management system disguised as a cryptocurrency.

FB's Libra whitepaper says:

An additional goal of the association is to develop and promote an open identity standard. We believe that decentralized and portable digital identity is a prerequisite to financial inclusion and competition.

But the design of Libra means that the identity data ends up owned by FB, not by the Libra ecosystem.

There's a summary of the UCL report at The Register [theregister.co.uk]

If slang for the US dollar is "buck," shouldn't

[doug141]

slang for the facebook libra be "zuck?"

Maybe backing crime money was a bad idea?

[Dallas May]

Dear Mark,

Love you, man. I've always thought you were awesome. You've made me lots and lots of money, which is my favorite thing about you.

But can we talk about this crime money plan of yours. I have this bad feeling it could backfire.

Love,
Your shareholders.

Re:

[Dallas May]

Almost certainly.

Probably though a scribe that's instructed to write only in gold sharpie.

Competition

[chuckugly]

Competition. Turns out governments don't like it one bit.

Re:

[Arthur Vandelay]

As it turns out money is a big reason my countries go to war. I wanna see Facebooks army of pocket protectors.

Re:

[pak9rabid]

Get with the 21st century man! It's an army of bad hair color & man-buns!

An example of the ...

[CaptainDork]

... Streisand effect.

Re:

[I4ko]

Um? All of the Hong Kong money are issued by private banks. But I agree Facebook should not be allowed near any money.

The merry-go-round of business...

[Arzaboa]

From the point of view of companies, these investigations are politically motivated and expensive. These are about draining the company of money and levying fines. As all of these are large corporations, there are no people to actually punish, but they will feel this in the boardroom when their plans are spoiled.

From the point of view of the average Joe, these investigations are politically motivated and expensive. These are about draining the company of money and levying fines. As all of these are l

Re:

[q_e_t]

These are about draining the company of money and levying fines.

Since the fines tend to be a very small proportion of the budgets of the state entities in blocs such as the EU, or the USA, and a relatively small proportion of the revenue of the companies, that seems unlikely.

inevitable

[hdyoung]

Anyone who wants to stand up a currency has to deal with a fiendishly complicated knot of issues. Currency exchange issues, geopolitical issues, clearing issues, links to other parts of the country/world economy, liquidity concerns, interest rates. And those are just the things that come immediately to my (non-financial-expert) mind.

Currencies. Some people thought that adding "crypto" to the front of the word would somehow avoid all these issues. They were, and are, wrong.

On a wholely unrelated note, no company on the planet should have the power of managing or controlling a currency. There are some VERY good reasons why that's the purview of governments.

Alas.

[denny_deluxe]

Poor, poor Facebucks, dead before they were born.

First To Mine == First To Billionaire

[HappySeafood]

We need to be skeptical of ANY cryptocurrency that's coming out. Bitcoin was designed so that only the first bitcoins would be easy to mine and it got progressively harder until coins ran out. If Facebook's crypto is the same, they and all their crypto cronies are busy mining coins for the last two years, and they'll be sitting on the easy billions when it goes live. There are BILLIONS of dollars up for free grabs with any new crypto. There's no NDA strong enough to prevent Facebook engineers from tel

Re:

[Pinky's Brain]

It was going to be a full reserve coin, with a basket of currencies. They might sneak a few money market funds in there for a few percentage point, but with Facebook itself backstopping any losses in that regard it would be close to risk free.

Not quite as good as the printing press backstopping FDIC, but good enough not to worry about. Better than an Euro account IMO (ECB came dangerously close to not respecting deposit guarantees in Cyprus ... that's EU bureaucrats for you, don't count on their sanity).

based in Switzerland?

[MS]

It "will" be based in Geneve in Switzerland, but isn't as of yet.
Swiss financial supervision was also not yet informed, but they will will monitor it, as soon as they get a request.

corporate currency

[bigtreeman]

A global corporate currency,
disconnected from any sovereign government,
answerable only to boards of directors,
the end play for The New World Order.
I have watched the development of the new world order for over 40 years, it's real.
who has watched Continuum on Netflix