Risk & Compliance

Facebook Says Libra Digital Currency May Never Launch

Since announcing the project last month, the company has faced pushback from U.S. and international regulators and lawmakers.
Facebook Says Libra Digital Currency May Never Launch

Facebook said pushback from U.S. and international legislators and regulators could delay the launch of the digital currency Libra or prevent it altogether.

In its second-quarter earnings filing with the Securities and Exchange Commission, the company said the laws around digital currency were “uncertain and evolving,” and adverse government action or negative publicity could harm the company’s reputation or business.

“Libra has drawn significant scrutiny from governments and regulators in multiple jurisdictions, and we expect that scrutiny to continue,” Facebook said in the filing.

Drive Business Strategy and Growth

Drive Business Strategy and Growth

Learn how NetSuite Financial Management allows you to quickly and easily model what-if scenarios and generate reports.

The company said it planned to launch the digital currency in 2020, but there could be “no assurance that Libra or our associated products and services will be made available in a timely manner, or at all.”

David Marcus, head of Calibra at Facebook, testified before the Senate Banking Committee and House Financial Services Committee earlier this month, where he faced harsh questions.

Calibra is the Facebook subsidiary formed to provide financial services and allow people to participate in the Libra network.

Treasury Secretary Steven Mnuchin and Federal Reserve chairman Jerome Powell have expressed concerns about the cryptocurrency network, saying it could be used for illicit purposes.

“There was a clear agreement from all G7 finance ministers and central bank governors that Libra, in particular, raises some very significant concerns, and cryptocurrencies more broadly,” Mnuchin said. “Before any of us let these go through, we’re going to make sure those concerns are satisfied.”

Facebook CEO Mark Zuckerberg, in a call with analysts, said the company’s approach to launching a product like Libra has changed over the course of a few years.

In a statement to CNBC, a spokesperson said, “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.”

Aytac Unal/Anadolu Agency/Getty Images