- Facebook warns investors that regulatory crackdown may disturb its plans.
- Facebook has seen a strong pushback on Libra from regulators and lawmakers.
The company planned to launch its proprietary cryptocurrency in 2020, but these plans may be disturbed due to regulatory scrutiny.
A strong pushback on Libra from international regulators and authorities may force Facebook to delay the launch.
In the latest quarterly report, Facebook warned that it couldn’t guarantee Libra “will be made available on time, or at all” due to various factors.
“Libra has drawn significant scrutiny from governments and regulators in multiple jurisdictions and we expect that scrutiny to continue,” the company says in its filing with the Securities and Exchange Commission.
Also, a mixed response from the community makes it difficult to access the potential market acceptance of such currency.
“We do not have significant prior experience with digital currency or blockchain technology, which may adversely affect our ability to successfully develop and market these products and services.” the company added.
David Marcus, the head of Libra and the corresponding digital wallet Calibra promised that Libra would become a low-cost and efficient payment tool for people who did not have access to traditional means of transferring money.
However, the U.S. Senate Banking Committee and the House Financial Services Committee seemed to stay unimpressed by his testimony earlier this month.
U.S. Treasury Secretary Steven Mnuchin, Federal Reserve Chairman Jerome Powell and U.S. President Donald Trump voiced concerns about Libra. Their sentiments are shared by other international regulators and authorities including French Finance Minister Bruno Le Maire and European Central Bank Executive Board Member Benoit Coeure.
“We know that the journey to launching Libra will be a long one and that we cannot do this alone. Engaging with regulators, policymakers, and experts is critical to Libra’s success. This was the whole reason that Facebook along with other members of the Libra Association, shared our plans early,” the spokeswoman of the company explained in the comments to CNBC.
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