Cryptoverse questions Facebook’s ‘centralized’ intentions after Libra Network is registered in Geneva

  • 02 July 2019, Tuesday, 14:00

Facebook’s entry into the cryptospace has resulted in mixed feelings within the community, primarily with respect to the social media giant’s motive behind the introduction of Libra. While the company had previously shared its intent to deliver a decentralized system governed by third party validators, the cryptoverse has identified a new registration in Geneva that implies Facebook’s attempt at gaining ultimate control over its upcoming cryptocurrency.

Twitter user, @iam_preethi broke news of the registration first and tweeted,

“A new LLC called Libra Networks S.a.r.l was registered in Geneva on May 2, 2019. Furthermore, Facebook Global Holdings II LLC owns all the shares in this newly incorporated LLC. Thus, a single corporation (i.e. Facebook) owns this network.”

Originally, Libra’s official whitepaper had hinted that a ‘consortium’ will be in control of The Libra Association (group of validators). However, it was never registered in Switzerland as a non-profit organization. On the contrary to the initial idea of decentralization, the new LLC called Libra Networks S.a.r.l seems to depict a centralized approach. @iam_preethi added,

“Facebook claims that the Libra Association is a “non-profit” in Switzerland and stated they intend to decentralize ownership. But evidence suggests otherwise. “

This revelation has forced the crypto-community to ask,

“If Facebook owns majority shares in this Libra Network, doesn’t this imply that FB can legally do whatever it wants to the network (i.e. control the validators, relocate, etc.) because it is the sole owner?”

While crypto-enthusiasts have taken this discussion to various online forums such as Twitter and Reddit, Facebook has not officially spoken about Libra Network registration. This has also led to numerous business leaders within the crypto-industry to believe that Facebook’s Libra initiative may not function as the cryptocurrency’s core intent, but rather play a greater role in the digitization of fiat currency.

Michael Arrington also shared similar views with the rest of the community, tweeting, “As far as I can tell none of the Libra partners have signed anything beyond a LOI and none have paid the $10m. Will be interesting to see how this plays out as governments sharpen their knives.”