Ever since Facebook announced its Libra stablecoin project back in June, views and opinions about the project were as varied as they can get. However, while many saw the potential in it and what it could mean for the decentralized economy, the amount of regulatory backlash has put a bit of blight in its future.
Currently, the prevalent opinion is one of doubt. Doubt that Libra will grow to become what Facebook initially intended, and doubt that the asset will even be released at all.
The latest industry insider to weigh in on this is Brad Garlinghouse, the chief executive of cryptocurrency operator Ripple Labs. In an October 7, 2019 interview on Forbes Magazine’s Balancing The Ledger, Garlinghouse spoke on the possibility of Facebook ever getting to launch the stablecoin, claiming that
When asked about whether Facebook will be able to make Libra into what it initially planned, Garlinghouse answered in the negative, pointing out that the regulatory pushback that the social media giant has already garnered is way too substantial for the original vision of Libra to ever play out.
The backlash has been brutal
Anyone who has been following the development of Libra so far will be able to identify with Garlinghouse’s sentiment. The asset has so much promise coming in, but after rounds of scrutiny from lawmakers both home and abroad, it seems increasingly less likely that Libra will see the light of day.
Regulators within the United States seem to be worried about Facebook and its ways of handling customer data and privacy, while lawmakers abroad are more concerned about the impact that such an asset could have on their economic sovereignty.
Already, German Vice-Chancellor Olaf Schulz has called for the country’s parliament to reject the use of parallel currencies, including and especially Libra.
With rumors that finance policymakers in the European Union are floating the idea of a EuroCoin to render Libra non-essential, it’s pretty evident that Facebook doesn’t have many friends in the policy scene.
A family feud?
Besides the regulatory pushback, there are rumors that members of the Libra Association (Libra’s Swiss-based governing body) are beginning to rethink their involvement with the Libra project due to fears of any backlash that could spill over to them as well. Popular payment processor PayPal already pulled out of the association on October 3, 2019, and there are reports that VISA, Stripe, and MasterCard are contemplating making similar decisions as well.
One positive for Garlinghouse
However, while the implosion of Libra would be terrible for Facebook, Garlinghouse himself won’t pinch himself if this happens. Ripple Labs was established on the promise of providing seamless cross-border payments, and considering that this is the same market that Facebook is hoping to tap into with Libra, there would be no way for the cryptocurrency company to compete.
For now, with Libra gone (or comatose, at the very least), Ripple can continue operations and focus on conquering the market.