What is the Libra Association?
A factual guide to Facebook’s partner hub for the Libra Blockchain
What is Libra?
In May of 2019, Facebook registered Libra Networks LLC in Geneva, Switzerland, one of the most friendly regulatory environments for cryptocurrency projects, in order to create a new digital currency and FinServe hub called Libra.
Libra was positioned as the new stablecoin (touted as a cryptocurrency) for the everyday online consumer, backed by one of the largest companies in the world.
In its highly anticipated white paper, the Libra Association announced that “Libra’s mission is to enable a simple global currency and financial infrastructure that empowers billions of people.”
The new digital currency will be built on the Libra Blockchain and fully backed by the Libra reserve, a basket of fiat currencies and ‘other assets’. The project claims to be decentralized and governed by the Libra Association.
Facebook has linked with 28 partners in a Geneva-based entity called the Libra Association, which will govern its new digital coin, set to launch in the first half of 2020, according to marketing materials and interviews with executives.
What is the Libra Association?
The Libra Association is an independent, not-for-profit membership organization headquartered in Geneva, Switzerland.
“Members of the Libra Association will consist of geographically distributed and diverse businesses, nonprofit and multilateral organizations and academic institutions.”
Founding members include:
- Payments: Mastercard, PayPal, PayU (Naspers’ fintech arm), Stripe, Visa = 5
- Technology and marketplaces: Booking Holdings, eBay, Facebook/Calibra, Farfetch, Lyft, MercadoPago, Spotify AB, Uber Technologies, Inc. = 8
- Telecommunications: Iliad, Vodafone Group = 2
- Blockchain: Anchorage, Bison Trails, Coinbase, Inc., Xapo Holdings Limited = 4
- Venture Capital: Andreessen Horowitz, Breakthrough Initiatives, Ribbit Capital, Thrive Capital, Union Square Ventures= 5
- Nonprofit and multilateral organizations, and academic institutions: Creative Destruction Lab, Kiva, Mercy Corps, Women’s World Banking = 4
Libra is designed to be a high throughput, global blockchain, one that’s built with programmable money in mind but limits how much users can do initially as it evolves from prototype to a robust ecosystem. Sound familiar? It’s cloning many aspects of public blockchains and crypto with oversight by major BigTech and payment companies.
The Libra Association is like seats at a global council on how the future of money will work. Facebook is rumored to be seeking $1B for the project with plans to bring on new partners in addition to those named.
What Facebook is trying to create is more than just a PayPal and Coinbase hybrid, it’s to establish itself as the leading digital currency hub and network to fuel and retain users in its suite of apps and walled gardens.
The Libra Blockchain is ambitious and the B2B play of the Libra Association is the key to funnel mainstream adoption. Advertising makes powerful friends and so does sharing user data with these partners. Now Facebook realizes it’s time to share the money and become officially the first BigTech companies to go after banking and digital assets with a consumer-facing blockchain payments product.
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