The social media giant Facebook has been working on building its own cryptourrency, called Libra, for almost a year and there have been reports that it could reveal the much-awaited venture into cryptocurrency anytime now. A recent report by the Wall Street Journal reveals the list of backers of the cryptocurrency.
Supporters of Facebook’s Venture into Cryptocurrency
The company has support of some of the most popular companies across retail, technology and payments. PayPal, Uber, Visa, Stripe, Booking.com and Mastercard are among the firms that will invest over $10 million each to fund development of Libra. For Facebook, it is important that Libra maintains its stability because the company is hoping to attract people from all over the world to accept it as a medium of transaction.
Regulatory challenges for Libra
Facebook has built layers of separation between itself and Libra. Neither the member companies of the Libra Association, the consortium which will govern the cryptocurrency, nor Facebook itself, will control Libra directly. Instead, the companies will play an essential role in the development of the Libra payments network, but only by acting as nodes to verify the transactions and not by regulating Libra. .
Facebook has been under pressure to deal with several privacy concerns like fake news, hate speech and misinformation on its platform, so it’s no surprise that it is being very careful when it comes to regulatory issues related to Libra. The company met with Mark Carney, the Bank of England governor, to discuss the risks as well as opportunities of the cryptocurrency. Further, to understand the challenges, the tech giant contacted money transfer firms like Western Union, as well as the US Treasury.
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