Facebook has acknowledged what many have been saying — that regulatory issues may be an insurmountable barrier to the launching of its Libra cryptocurrency project.
In a frank disclosure in the business’s latest quarterly report into the U.S. Securities and Exchange Commission (SEC), the company said that the numerous barriers it will face regarding regulating a new technology with uncertain rules in the U.S. and other countries of the world, mean “there can be no assurance that Libra or our related products and services will be made available in a timely fashion, or at all.”
“Our involvement in the Libra Association will subject us to significant regulatory scrutiny and other risks that could adversely impact our business, reputation, or financial benefits,” Facebook states.
And not only is Libra “based on relatively new and unproven technology,” the laws and regulations around digital money are”evolving and uncertain.”
“Libra has attracted significant scrutiny from authorities and regulators in numerous jurisdictions and we anticipate that scrutiny to continue,” the SEC filing states.
The Libra project — that could bring into the countless Facebook users about crypto adoption — has caused something of an uproar in circles Since the company says.
Central banks, government ministers and watchdog chiefs have been lining up to demand more information about the job over fears it might pose a threat to central bank money and fiscal stability, and supply a global avenue for money laundering and fraud.
The G7 countries formed a task force to check into problems around cryptocurrencies, but with a steely focus on Libra. It concluded earlier in July that regulations of the”highest standard” would be required to govern the job.
Some, such as the mind of the House Financial Services Committee, has called for the project to be stopped while these issues are addressed.
Facebook further says in the filing:
“These laws and regulations, as well as any associated inquiries or investigations, may delay or impede the launch of the Libra currency as well as the development of our products and services, increase our operating costs, require significant management time and attention, or otherwise harm our business.”
The company’s own doubts about its project’s viability aren’t down to regulation. It mentioned the uncertainty of Libra taking off as a favorite product as another potentially confounding variable, and it’s own lack of”significant prior experience with electronic money or blockchain technology”
This may”adversely affect our ability to successfully develop and market these services and products.”
Facebook looks a bit worried about how much it is splashing out on this white elephant project. It concludes from the filing:
“We will also incur increased costs in connection with our participation in the Libra Association and the development and marketing of associated products and services, and our investments may not be successful. Any of these events could adversely affect our business, reputation, or financial results.”
