Source: beincrypto
Compiled by: Blockchain Knight
David Marcus, the former head of the Facebook Libra crypto asset project, recently revealed the reasons for the project's failure.
According to Marcus, although the project was designed robustly and underwent extensive regulatory consultation, regulatory pressure and the withdrawal of support institutions ultimately led to its halt.
On November 30, Marcus published an article on X detailing a series of events that led to the termination of Libra.
This blockchain-based payment system was later renamed Diem, aiming to revolutionize global payments by combining high-performance blockchain with stablecoins.
However, Marcus stated that the failure of the system was not significantly related to legal or regulatory issues.
On the contrary, regulatory forces played a decisive role.
Marcus stated, 'Here’s a point worth mentioning: the government or regulatory bodies did not kill the project from a legal or regulatory perspective at all.'
'This is 100% a regulatory conspiracy, primarily using intimidation against the banks involved in this project.'
Marcus revealed that Libra encountered bottlenecks immediately after its announcement in 2019. Although the team made some adjustments and postponed the project launch to 2021, regulatory opposition remained.
Marcus emphasized that Federal Reserve Chairman Jerome Powell changed his stance after meeting with Treasury Secretary Janet Yellen, marking a turning point.
Marcus revealed that Yellen referred to supporting Libra as 'regulatory suicide,' which prompted the Federal Reserve to warn banks involved in the project.
Reportedly, during these calls, the Fed's general counsel warned banks against advancing the Libra project, citing dissatisfaction with it.
'The Federal Reserve spoke with all participating banks, and the Fed's general counsel read a prepared statement to each bank, saying, 'We cannot stop you from advancing and launching projects, but we are uncomfortable with you doing so.' And that was that.'
Since then, industry figures in the crypto asset space have rallied behind Marcus's assertions.
Former Libra board member Kathryn Haun and Gemini co-founder Tyler Winklevoss both highlighted how regulatory motivations derailed Libra.
Winklevoss stated, 'Gemini worked closely with David and his Meta team to help launch Libra (also known as Diem).'
'When federal regulators vetoed this project, we were all in the same boat. It was all regulatory factors, with no legal basis.'
Reflecting on this experience, Marcus emphasized the necessity of decentralization when building the future financial system.
He believes BTC is an ideal foundation for such networks, citing BTC's neutrality and tamper-proof design.
Marcus concluded, 'If you want to build an open monetary network for the world, capable of flowing trillions of dollars daily and sustainable for 100 years, it must be built on the most neutral, decentralized, and tamper-proof network and assets, and that undoubtedly is BTC.'
Marcus's revelations intensified scrutiny of 'de-banking' within the crypto asset and technology sector.
Recent allegations regarding regulatory motivations for financial restrictions have sparked further discussions about the intersection of regulation, oversight, and innovation in the United States.
