US Senators Warn Three Libra Backers of Membership Risks

A letter tells Visa, Mastercard and Stripe that they “should be concerned” about the implications of supporting Facebook’s Libra nodes.

Three backers thought to be reconsidering their involvement in Facebook’s digital currency Libra have received warnings from the United States politicians over their participation.

Senate letter: Facebook’s problems are your problems

According to a Bloomberg article published on Oct. 9, a letter to Visa, Mastercard and Stripe was sent by two U.S. senators. In it, they are reportedly pressuring the three payment giants to look closer at the regulatory implications of Libra.

The report comes a week after the rumors started to spread about the companies’ cold feet over Facebook’s digital currency.

PayPal, formerly a member of Libra, then officially left — saying that it fears the kind of repercussions the letter appears to embody. The senators’ latest message reads:

“Facebook is currently struggling to tackle massive issues, such as privacy violations, disinformation, election interference, discrimination, and fraud, and it has not demonstrated an ability to bring those failures under control. [...] You should be concerned that any weaknesses in Facebook’s risk management systems will become weaknesses in your systems that you may not be able to effectively mitigate.”

A widely-forecast backlash

One of the letter’s authors, Sherrod Brown, is conspicuous for being the senior Democrat on the Senate Banking Committee. As Cointelegraph reported, the Committee has taken a highly skeptical view of Libra, conducting multiple hearings in which it grilled executives over their plans.

Brown now seems to suggest that a general distrust of Facebook could translate into distrust of its financial activities. His words echo the predictions of teething problems made by Brad Garlinghouse.

“Facebook has been in the crosshairs of a bunch of governments around the world,” the Ripple CEO warned — adding that he doubts Libra would appear before 2023.

Publication date: 
10/09/2019 - 10:35
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