The 20 companies partnered with Facebook to form the Libra Association are yet to make a monetary commitment for the project, the BBC revealed on Wednesday.
The Libra Association was officially formed on October 14. However, it is still an unbinding one and allows the members to leave anytime.
Citing several sources, the publication reported that none of the members signed an agreement for payment, and the issue was not brought up at the first general assembly of the association.
“Rather than collect a bunch of money from a bunch of people and then figure it out,” one of the sources said, “the feeling is that we needed to form, ratify a budget, and then figure out how to fund that budget, rather than the other way around.”
$10 million fees for managing the network
Formed by Facebook, each member of the Libra Association is supposed to make a commitment of $10 million to be a part of managing the ambitious digital currency.
The association also formed a five-person board including David Marcus, the head of the Calibra, along with representatives from Kiva Microfunds, PayU, Xapo Holdings, and Andreessen Horowitz.
Though 28 members, including Facebook, originally pledged to form the Libra Association, seven major partners left the consortium amid concerns over attracting negative regulatory attention. The exodus was initiated by PayPal, followed by six other big names, including Visa, Mastercard, and Stripe.
Facebook itself is facing a lot of regulatory backlash for jumping into the financial industry with its proposed digital currency. The company’s CEO, Mark Zuckerberg, is scheduled to testify before Congress today after Marcus did the same both before Congress and the Senate.
“We’ve seen Facebook start to move away from the Association a little bit, maybe, but it’s still a challenge for them, definitely,” another source told BBC.
(Photo: flickr)
