Chris Brammer: “Libra Amended the White Paper and Excluded Dividend Payments”

Chris Brummer, a professor at Georgetown University Law School, published an article in which he reportsabout changes in the technical document on the Libra project from Facebook, among which - the lack of dividends for investors.

As the professor stated, re-reading the Libra document,he noticed a number of changes in it and decided to compare it with the original version published in June. Naturally, amendments were made to Libra Association members after the departure of five key partners, including Visa and Mastercard.

Significant change that discoveredProfessor, there was a lack of dividends paid to investors who invested in a project to launch an ecosystem. Now, the Libra document states that interest on reserve assets will be used only to cover costs in the system, to ensure low transaction fees and further development, without mentioning dividends.

Professor Brammer suggests that Libra couldmake such changes, hoping that regulators will cease to consider its coins securities. According to the Howie test, if the purchase of a financial product is made without the goal of making a profit, this financial product cannot be called a security. Accordingly, having deleted information about dividends, the Libra project decided to exclude the profit factor and protect itself from the claims of regulators.

At the same time, the professor of law believes that the removal of any references to the receipt of dividends is unlikely to beaffect the legal status of Libra coins – if they are stablecoins and their value will not begrow, these coins simply can't be securities.

Chris Brammer is inclined to the version that causechanges to the technical document could be a conflict of interest between members of the Libra Association, which relies on Libra investment tokens, and retail buyers of Libra coins.

To stimulate the implementation of Libra, standbythe assets that the coins provide must be stable. But if dividends are paid out of interest on these assets, the project can use the reserve with high-risk assets, which in turn will reduce the credibility of Libra, because the so-called stable coins can lose their value.

The Libra project was criticized by South Korea and India, and in October, the U.S. Treasury Department said it would continue to explore the risks associated with the Libra cryptocurrency project.

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