Facebook’s Libra Facing Antitrust Investigation in Europe
The EU antitrust regulators have opened a probe on Facebook’s Libra project, amid concerns the proposed payment system may outcompete rivals.
The European Commission’s antitrust body is investigating Facebook’s Libra project, reported Bloomberg based on document sources. The Commission’s concern is that Facebook’s influence would give undue success to Libra and outcompete other players in the sector.
Facebook’s Libra has not been met with a green light by regulators worldwide. The chief concern is that it would violate capital controls and possibly lead to the creation of a grey economy.
The current probe is just preliminary research, aiming to explore the parameters of Facebook’s projects. This includes the governance structure based on the Libra Association, a body of potential block producers. Reportedly, MasterCard and VISA have already signed a loose document of association with Facebook’s Libra.
Since the Libra Association is registered in Switzerland, the country’s Federal Data Protection and Information Commissioner (FDPIC) expects a report on user data protection by the end of August. Facebook’s Libra was announced on the tails of a scandal that revealed widespread sharing and manipulation of user data to target content. Thus, the concerns about Facebook’s privacy practices regarding Libra concerns multiple regulators.
US lawmakers headed by Maxine Waters are also planning to visit the FDPIC and discuss Libra within a week.
The fate of Libra remains highly uncertain, with Facebook itself stating the project could be delayed indefinitely and there is the potential the coin would never be created. Currently, regulators have been unable to stop the block production or transactions for any already established blockchain. However, more ambitious intentions to create a digital asset payment system have been met with skepticism, as in the case of Estonia’s Estcoin, which was discouraged by the European Central Bank.
For about two months now, Libra has revealed its infrastructure with an invitation to developers. However, Facebook is not involved in the drive to organize development plans.
The coin’s technology allows for the creation of a testnet, but with no assurance of building a mainnet based on the participation of Libra Association members.