Wave of distrust hits Facebook’s Libra currency
Facebook s planned virtual unit Libra, under heavy attack from US President Donald Trump and global regulators, also faces scepticism among the wider cryptocurrency community.
One theme, besides Brexit, dominated talk among the movers and shakers in London’s financial technology, or FinTech, industry as they gathered for their annual get-together: the future of virtual currencies.
“Can I just ask you to raise your hand if you would not be willing to use Libra,” asked the moderator at an event at London’s recent FinTech Week.
In the room, filled with about 100 experts and media who track the sector closely, about two-thirds of participants raised their hands to express distrust at the upstart currency.
Helen Disney, founder and boss of Unblocked Events, which promotes the blockchain technology that powers many cryptocurrencies, acknowledged rising doubt about who exactly would oversee and regulate Libra’s operation.
She said people are “concerned about how the governance would work. The cryptocurrency community is very libertarian in thinking.” It’s “about giving power to the people, democratisation of finance, keeping away from big banks and companies who control [the] economy”.
Last week’s gathering came a month after Facebook spelled out its plans for the virtual currency. Libra, seen widely as a challenger to dominant global player bitcoin, is expected to launch in the first half of 2020.
Unlike bitcoin, which is decentralised, Libra will be comanaged by 100 partner firms, including new Facebook financial services division Calibra. Companies behind Libra, which will be backed with a basket of real-world currencies, include payment giants Visa, MasterCard and PayPal, as well as taxihailing services Lyft and Uber.
To access Libra on smartphones, users will go through a virtual wallet also named Calibra. Facebook boasts a global customer base that should facilitate Libra’s uptake, but it is plagued by privacy worries that may make users hesitate.
“Can’t wait for a cryptocurrency with the ethics of Uber, the censorship resistance of Paypal, and the centralisation of Visa, all tied together under the proven privacy of Facebook,” said Sarah Jamie Lewis, head of nonprofit research organisation Open Privacy.