Facebook's Libra selects board as support shrinks further

London

BACKERS of Facebook Inc's Libra cryptocurrency project pledged to forge ahead after selecting a five-member board on Monday, shrugging off the latest member defection by online travel company Booking Holding earlier in the day.

"It is a correction; it's not a setback," said Dante Disparte, head of policy and communications for the Libra Association, whose 21 remaining members held their inaugural meeting in Geneva.

The owner of Priceline, Kayak and Booking.com on Monday confirmed that it had pulled out of the group, which is trying to bring digital coins into mainstream commerce.

Libra lost its last global payments backers on Friday, when Mastercard Inc and Visa Inc abandoned the Geneva-based Libra Association. EBay Inc, fintech startup Stripe and payments company Mercado Pago also pulled the plug.

The exodus followed warnings from politicians and regulators, from the United States to Europe, that Libra risked upsetting global financial stability, undermining users' privacy and facilitating money laundering.

The latest withdrawals followed the departure of PayPal Holdings Inc from the Libra Association earlier this month. It leaves Facebook without the backing of any major payments firms for the project, due to launch by June 2020.

Mr Disparte acknowledged that the digital currency's regulatory issues could push back its launch date.

At the meeting in Geneva, members agreed on interim articles of association laying out how the organisation will be governed, as required by Swiss law, according to a fact sheet provided by the Libra Association.

Most decisions will require a majority vote of the group's governing council, although changes to membership or management of the reserve would require a two-third supermajority.

The group elected five people to serve on the board, including Facebook's David Marcus as well as representatives from PayU, venture firm Andreessen Horowitz, blockchain company Xapo Holdings Limited and non-profit Kiva Microfunds.

The association's other prominent remaining members include Vodafone Group Plc and ride-hailing firms Uber Technologies Inc and Lyft Inc. Its only payments firm remaining is Netherlands-based PayU, which according to its website does not operate in the United States, Canada or large swathes of Africa and the Middle East.

The departure of major financial firms means Facebook can no longer count on a global player to help consumers turn their currency into Libra and facilitate transactions.

This presents a new stumbling block for Libra's efforts to convince regulators and politicians about the coin's safety. France pledged last month to block Libra from operating in Europe, while the Bank of England laid out high hurdles it must meet before its launch. REUTERS