Mark Zuckerberg’s latest project Facebook’s Libra just might not get a place in the Cryptocurrency field as the news states that 3 companies are backing off from the project Facebook’s Libra. As stated by the report produced by the Financial Times, some of the original backers of the Cryptocurrency project are trying to distance themselves from the latest project, while some others are looking for all sorts of disconnections with Facebook’s Libra.
There is nothing unknown that extremely strict scrutiny by regulators is weighing down Facebook’s Libra project since its launch. Facebook’s Libra, even when it was officially unveiled to the world, was not well received by a huge majority of people, including governments themselves. This is now proving to be the biggest obstacle in the project’s course and could kill the platform’s newest endeavor before it hits the market to prove its capabilities. And even if it does succeed to the launch, there would be nothing left of the originally envisioned Facebook’s Libra Project by the social media giant.
Ever since the official whitepaper of Facebook’s Libra was released, it looked-out about how it would be backed by some of the most prominent names that stretched out to different industries including, Coinbase, Lyft, MasterCard, PayPal, Uber, and Visa amongst the others. Recent reports suggest that out of the 28 investment backers, at least 3 are starting to have second thoughts about their alliance with the social media platform for Facebook’s Libra Project.
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Facebook’s initial planning regarding its project Libra has been highly hampered by the new development. Mark had planned to launch Facebook’s Libra full-fledged by the next year that is in 2020 and had been bearing the high hopes to increase the number of members in the Libra Association from 28 to 100. Nevertheless, considering how some of the most initial backers are shaky with their partnership with Facebook’s Libra, that number may be harder to reach now as the condition reveals.
Now a question may arise at this point, what exactly is scaring off the investors into losing their trust and confidence in the upcoming Facebook’s Libra project? The answer to this is pretty elementary, which are the regulators all over the world are increasingly casting huge pressure by putting the project under microscopic scrutiny. Although the reports have not disclosed the identity of the second-guessing investors, however, they did unveil that the first of the two backers of Facebook’s Libra was concerned about the regulatory spotlight that they had been attracting due to this.
One of the backers reportedly shared that they are now distressed about supporting Facebook’s Libra project because they fear to attract the attention of agencies that oversee their own business. In simpler words, they want to put their own interest above their association with Facebook’s Libra. Furthermore, the backers are also reportedly worried about what steps that should be taken from here on out considering the regulatory torment that has befallen Facebook’s Libra.
Facebook, on the other hand, is not entirely heedless to the current loss of confidence from its backers, nevertheless, the social media platform as per the reports, is more frustrated than it is afraid of losing out on its backers. It seems that the team behind Facebook’s Libra was hoping that the backers would come to the support of the project instead of backing out. In the past couple of months, Libra has been bombarded with all kinds of negative comments. From the President of the United States Trump, claiming that the platform’s virtual currency, Facebook’s Libra, will have little or no standing, to Democratic representative Rashida Tlaib, who called out Libra as a potential crypto mafia. It is crystal clear that people are afraid of the threats that will accompany the project, like money laundering, tax evasion and disruption to wider financial stability.
It could be deduced from all the bad press that the social media giant is currently going through; it is quite evident that people are not willing to invest their trust in the hands of a platform that has successfully garnered a bad reputation for mishandling the customer privacy. Off lately, Facebook has agreed to pay a record of $5 billion to resolve a U.S. investigation into years of privacy violations, a settlement that increases the board of directors responsibility for protecting users data by all means. Which brings in the question – can the social media platform be trusted with something as sensitive as financial information?
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