US politicians turned the screws on Facebook’s blockchain-based payments play Libra, urging financial institutions backing the scheme to reconsider their involvement.
Senators pressed the CEOs of Visa, Mastercard and Stripe over the companies’ involvement in the Libra Association, suggesting they will face a high level of scrutiny from regulators if they continued to participate in the group.
The Libra Association, which also counts Vodafone Group, Iliad and other major tech players as members, will run the new global currency and financial infrastructure.
In a letter to the executives, politicians wrote Facebook “appears to want the benefits of engaging in financial activities without the responsibility of being regulated as a financial services company”. The trio should “expect a high level of scrutiny from regulators not only on Libra-related activities, but on all payment activities”, if they continued to back the play.
The warning comes a few days after digital payments player PayPal withdrew from the Libra Association, following increased pressure from regulators.
Speaking to The Verge, Libra Association policy chief Dante Disparte said the group maintains a commitment not to launch the project until it has addressed all regulatory concerns. Facebook is still targeting a 2020 rollout.
In addition to the US, the European Commission and national regulators across the globe have expressed concerns about Facebook’s dive into the sector.Subscribe to our daily newsletter Back