Facebook is ready to defer its own Libra cryptocurrency proposal, two media reports said Tuesday. However, Facebook said it remains committed to the project – and one of the two media companies has partially withdrawn its original report.
A new report by The Information, quoting "three people familiar with the matter", said Facebook had decided not to support the new virtual currency in its own products. Instead, Facebook offers users the option of making payments using traditional currencies such as the dollar and the euro. The launch of Facebook's expected digital wallet software will also be delayed by "several months," the information said.
To update: In a subsequent tweet, The Information's Alex Heath wrote that he had spoken to Facebook and now believes the company "will support the original Libra token concept in his wallet. However, expect it to be the new digital government currencies." highlights who wants to introduce it. "
Bloomberg also spoke to "three people who are familiar with the matter," but described the situation differently. According to Bloomberg, Facebook and its partners are "weighing up a new version of the scale as a largely payment network that could work with multiple coins."
In an email to Ars Technica on Tuesday, a Facebook spokeswoman emphatically denied reports that the social media giant withdrew from the scales.
"The message that Facebook does not intend to offer the Libra currency in its Calibra wallet is completely wrong," she wrote. "Facebook remains fully committed to the project."
A Libra Association spokesman told Ars Technica that nothing had changed.
"The Libra Association has not changed its goal of building a regulatory global payments network, and the fundamental design principles that support that goal have not been changed, nor has the network had the potential to encourage future innovation," the spokesman said in an E -mail Policy.
The scale has been under fire since it was announced
Enlarge /. David Marcus, Head of Blockchain on Facebook, speaks at a hearing of the House Financial Services Committee on Wednesday, July 17, 2019.
When Facebook introduced the Libra last June, it triggered an immediate backlash from government officials in the United States and around the world.
"I don't think the project can move forward … without much of the way the company has dealt with money laundering," said Fed Chairman Jerome Powell in early July.
Later that month, Facebook seemed to be pulling back from its original vision that Libra should be a fully open, decentralized network. During the testimony from Congress last July, David Marcus, the public face of the Facebook Libra project, assured regulators that the Libra would be equipped with controls for money laundering, terrorist financing, and other possible abuses.
However, this type of control directly contradicts the decentralized philosophy of traditional blockchain-based networks. To stop the abuse of the network, Facebook would have to check anyone who creates an app or offers a payment service on the network. However, adding this type of bureaucracy would not help Facebook make the network accessible to users in developing countries.
These promises may also have prompted Facebook to enforce a wider range of regulations that countries around the world impose on domestic financial networks. Conventional blockchain networks like Bitcoin bypass these rules because the authorities can't punish anyone if the Bitcoin network doesn't meet the requirements. But that approach wouldn't work for Facebook – which meant Facebook could be in a regulatory quagmire while trying to satisfy hundreds of different regulators around the world.
In October, some of Facebook's most important Libra partners withdrew from the project. Stripe, Visa, Mastercard and Mercado Pago cancel in one day. PayPal had canceled a few days earlier. Facebook continued with its remaining 20 partners. However, it was hard to ignore that the companies that jumped the ship were some of the most experienced companies that actually operated payment networks.
Facebook says it continues to push the project, but it won't be easy.