September 20, 2020

US Treasury Secretary: Companies Leaving Libra Due to Regulatory Concerns

Gaining momentum for large companies previously announced as digital currency project partners Facebook's Libra is directly related to their concerns about the proposed project’s non-compliance with regulatory requirements. Such a statement in an interview with CNBC made US Treasury Secretary Stephen Mnuchin.

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Over the past few days from participating in the projectthe operator of the electronic payment system PayPal, payment systems Visa, Stripe and Mastercard, the Latin American trading platform MercadoLibre, and the e-commerce giant eBay refused. In addition, on Monday, October 14, it became known about the withdrawal from the Libra Association of Booking Holdings Inc.

Thus, out of 28 companies that were named partners of the Libra Association in June this year, 21 participants remained in the Facebook project.

According to Stephen Mnuchin, he met with representatives of Libra several times, confirming during these meetings the intention of the US authorities to oppose the launch of the project.

“I think they [Libra] realized that they haven’tready and meet the requirements. I believe some of the partners were worried and left the project until they met these standards. ” - said the minister.

Meanwhile, Brian Armstrong, CEO of the largestUS cryptocurrency company Coinbase, commenting on the statements of some politicians who had previously called on Visa and Mastercard to exit the Libra Association, called this behavior "non-American."

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Developing his thought, Armstrong noted that no matter what exactly someone thinks about Libra, if this is not a useful or innovative tool, people simply will not use it.

“Why this scare tactic? If any private company did that, it would be called anti-competitive / monopolistic behavior. ” He wrote.

The head of Coinbase also wonders ifThe United States has a planned economy, or they want the free market to test a thousand ideas in order to find one that will be breakthrough and give real value.

“Breakthrough ideas are dissent by definition, otherwise they would all have been tried,” - added Armstrong.

Recall, on October 23, Facebook head Mark Zuckerberg will take part in the hearing of the Financial Services Committee of the US House of Representatives, where he will answer questions from lawmakers about the Libra project.