The Libra Association now has a total of 21 of the initial 28 members. Libra will not be launched until it can meet the concerns of regulators.
Although the Libra Association has not been officially launched, it has already lost a quarter of its members. This is because Booking Holdings, an online travel company operating websites, such as Kayak.com and Priceline.com, joined Visa, MasterCard and four other companies to abandon the controversial cryptocurrency project led by Facebook.
With the departure of Booking Holdings, a company based in Norwalk, Connecticut, the Libra Association is now left with a total of 21 of the original 28 founding member companies that joined the association last June. It should be stated that in the past two weeks PayPal Holdings, Stripe, MercadoLibre and EBay have also said that they would abandon the project.
The members of the Libra Association, a nonprofit organization that would manage the cryptocurrency, planned to meet on Monday, October 14th, in Geneva, Switzerland, in order to finalize both their governance charter and their initial membership.
The Facebook cryptocurrency was subject to intense scrutiny on the part of lawmakers and regulators as soon as the company announced the project. Regulators warned that Libra, which was originally scheduled to be launched next year, might be used by criminals if it is not properly controlled. In the meantime, lawmakers made a mockery of Facebook’s history during the hearings held in July, where Libra co-founder David Marcus participated.
Officials from some countries, including Germany and France, announced that they would ban the use of Libra and said that the cryptocurrency might be a threat to their monetary policy, among other concerns.
The global payments and technology companies Visa, MasterCard and Stripe abandoned the project shortly after receiving a letter from Democratic senators Brian Schatz of Hawaii and Sherrod Brown of Ohio
Brian Armstrong, CEO of Coinbase Inc., a member of Libra, said on Sunday, October 13th, that the pressure was perceived as “anti-American.” He asked via the social network Twitter what the need to use intimidation tactics was, since this would be called anti-competitive/monopolistic behavior if some private company did.
In the face of the departures occurred in recent weeks, Facebookâs Libra has said that more than 1,500 companies shown their interest in joining the association and that the currency would not be launched until it could meet all the concerns of regulators.
The developers have continued to make progress in the design of the open source software that supports Libra. However, Visa, MasterCard and PayPal could have generated a critical experience in financial regulators in the United States, which makes their departures particularly painful. Booking Holdings, which has a market capitalization of more than USD 84 billion, was the only large company that had remained in the project.
Facebook executive director Mark Zuckerberg plans to testify next week before the Senate Financial Services Committee on Libra, among other subjects.
The representatives of the Libra Association did not immediately respond to the request for comments.
By Willmen Blanco
