VISA Dial Down Expectations for Facebook’s Libra Project

VISA Dial Down Expectations for Facebook’s Libra Project

VISA, one of the potential node operators for Facebook’s digital currency Libra, attempted to moderate expectations of their involvement in the project during a Q3 2019 earnings call on Tuesday.

Perhaps with the recent U.S. congressional hearings into Facebook’s proposed currency fresh in his mind, Alfred F. Kelly Jr, Chairman and CEO of Visa Inc., declared that “…it’s really, really early days and there’s just a tremendous amount to be finalised.”

Non-binding intent

During the call, Deutsche Bank’s Bryan Keane asked for clarification on whether the Visa board saw Libra as a strategic partner or “…potential disruptive threat?”

Visa’s CEO immediately tried to rein back conjecture and stated “…it’s important to understand the facts here and not any of us get out ahead of ourselves” before going onto say that “…we have signed a non-binding letter of intent to join Libra…” but as with other companies slated to be involved “…no one has yet officially joined.”

Kelly explained that although Visa were interested in Libra and in discussions with Facebook, their “…ultimate decision to join will be determined by a number of factors, including obviously the ability of the association to satisfy all the requisite regulatory requirements.”

The regulatory requirements in relation to Libra that Kelly refers to were also discussed prominently at the U.S congressional hearings earlier this month.

Congressman Tom Emmer listed a number of those agencies responsible for the U.S. financial system at the hearings including “…the U.S. Treasury regulates payment systems for Anti-Money Laundering (AML) compliance, the FTC regulates for fraud, and each state regulates for consumer protection…” 

Yet, vocal anti-Bitcoin Congressman Brad Sherman who has been as equally scathing in his assessment of Libra, conceded during the hearings that all those regulatory agencies will not be enough and corruption will likely see the project succeed because Mark Zuckerberg “…probably has the power to push this through. He’ll throw around tens and hundreds and millions of dollars in Washington [and] his supporters will get huge Zuck Bucks in U.S. dollars.”

Sherman concluded that Libra “…is an attempt to transfer enormous power from America to Facebook and a number of their allies.”

While a number of those allies remain hidden, the consortium of companies who formed the Libra Association and Council, including Visa, have publicly announced their collaboration with only the depth of that support yet to be determined.