Facebook’s Libra crypto project will be pushed back another two years at least, and is in danger of not even getting off the ground, says a US economist.
The social media giant announced last month it would be launching the Libra coin next year under its Calibra subsidiary as it took its much-anticipated steps into cryptocurrency.
Days after of the announcement, several US senators voiced deep concerns about the nature of Facebook’s declaration, accusing the global social media colossus of arrogance and assuming their plans would be given the green light without scrutiny.
That scrutiny is currently giving Libra’s senior team a brutal week under the piercing eyes of US Congress – only days after public lambasting from US president Donald Trump, Treasury Secretary Steven Mnuchin and Jay Powell, head of the Federal Reserve.
Trump turned his ire on both Bitcoin and Libra, saying cryptocurreny was based on nothing but “thin air”.
However, a series of three-hour hearings this week on Capitol Hill forced Libra’s co-creator David Marcus to concede that Libra would not launch without approval from regulatory bodies.
That, says economist Janice Winterburn, could be the stumbling block Libra weren’t expecting – and one that could severely delay or even jeopardise the entire project.
“I was observing two hearings this week, and I would say with all certainty that David Marcus had not anticipated this level of hostile sentiment towards Libra,” she said in a Coin Rivet article for express.co.uk.
“In all fairness, Mr Marcus carried himself very well in the face obvious disdain from many people within the government who are clearly against the march of cryptocurrency in general – not just Libra.”
Libra CEO and co-founder David Marcus
The analyst also told express.co.uk that a delay for Libra became inevitable when one senator in the Congress hearings began their speech by describing Facebook as ‘dangerous’, triggering widespread nods of approval.
“A high-profile Democrat senator – Sherrod Brown – was extremely uncomplimentary about Facebook on the whole and, at that point, I was looking around the room and seeing a lot of support for his views,” she added.
“Whatever David Marcus and Calibra thought they might achieve here didn’t happen, despite their best efforts.
“I think the obvious take-out here is that Libra won’t happen next year, and maybe not even the year after that – there’s just no way the regulatory authorities can possibly pass this within Libra’s proposed timeframe.
“In fact, I think you could safely place some bets based on the chance that Libra may not happen at all, given the sentiment of Congress and White House right now.”
Is there a darker side to Libra? https://coinrivet.com/is-there-a-darker-side-to-libra-facebooks-new-crypto-project/