Facebook's Facecoin

Facebook Co-founder Expresses Concern About Libra

According to leading mainstream news media outlet The Guardian, Chris Hughes, one of the original co-founders, has recently warned crypto enthusiasts against using the much-hyped Libra cryptocurrency. As we have covered earlier, Facebook has taken the initiative to start a native cryptocurrency called Libra, and has already found some major backers to be a part of the consortium that will govern the currency. According to Chris Hughes, these corporate organizations will play too powerful a role in the administration of the cryptocurrency, which will give them undue power over people’s finances. This will, in turn, compromise the principle of decentralization that is essential to cryptocurrencies.

Chris Hughes, who had been a part of Facebook in its early days, said that regulators around the world should rein in the process to make sure this purported cryptocurrency does not get out of hand. Hughes is currently the co-chairman of the Economic Security Project, an anti-poverty campaign. The various corporates that are a part of the Libra Association include MasterCard, PayPal, Uber, Spotify and Vodafone, numbering to 27 in total.

He reportedly commented that:

“If even modestly successful, Libra would hand over much of the control of monetary policy from central banks to these private companies […].If global regulators don’t act now, it could very soon be too late.”

Moreover, in an article he penned for the Financial Times, Hughes said that the corporate members, who had all poured in 10 million dollars into the project would become able to “disrupt and weaken” the functional economies and structures of nation states.

His warning emphasized that if enough people in developing countries with emerging economies began to use Libra by trading them against local fiat, it would interfere with governments’ ability to formulate and conduct their own fiscal policies.

He has also commented on the policies of Facebook as a whole, saying:

“The company’s decision to offer live broadcasting made it possible for teenagers to stream bullying, terrorists to live-cast an execution and a gunman a mass shooting.It has similarly transformed mobile messaging and news and journalism faster than many imagined.”

Libra has already generated quite a bit of controversy in the crypto and tech communities and Hughes’ comment has added more fuel to the fire. Will Facebook Libra really threaten governmental autonomy? Only time will tell.