Australian consortium wants a ‘seat at the table’ in the development of Facebook’s Libra cryptocurrency
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Facebook drew plenty of headlines a couple of months ago with the announcement of Libra, its proposed digital currency.
Since then, the narrative has largely focused around how many regulatory hurdles the concept will have to clear before it can be implemented.
But while there’s a long way to go before the project becomes reality, brothers Heath and Luke Behncke — principals at Australian fund manager Holon Investments — are taking steps to get involved in the process.
To that end, the pair have established Libra Australia — an organisation which is now looking to partner up with local companies, universities and social organisations.
The end goal is to establish a group which meets the criteria for admittance to the Libra Association.
Facebook’s initial concept had tentative backing from a group of 28 founding members — including global payment heavyweights Visa and Mastercard — to establish a global cryptocurrency based on a basket of fiat currencies headquartered in Switzerland.
Since then, some founding members have expressed doubts about staying in the Association. And US lawmakers remain concerned, after holding a series of meetings with Swiss government officials last week.
While the road ahead will be highly complex, Luke Behncke says Swiss regulators have “opened the door” for a global digital currency by providing early backing for the idea.
And Australia now runs the risk of falling behind if it doesn’t at least get involved in the process.
Having researched the initial concept when it was made public, the Behnckes discussed the idea with their local network across blockchain, finance and regulators but “didn’t get much back”.
“That’s when we bit the bullet and started following up with interested parties,” Behncke told Stockhead.
“If we’re going to position Australia to be more active in innovation, we need to be involved in the conversation and the best way to do it is to get a seat at the Libra table,” he said.
Doing so isn’t easy — the Libra Association deploys strict criteria for membership across the business, education and non-profit sectors.
For example, companies are required to have turnover of at least $1 billion with a user reach of 20 million — not a simple task for a country with a population of just 25m.
“It’s a tough gig for any one entity to seek membership, so we felt our best shot was to gain membership through a consortium,” Behncke said.
“A partnership agreement with multiple groups is hard, but we really felt we had to bite the bullet and do it.”
In addition to Holon, Libra Australia has nine partners including law firm Gilbert + Tobin along with Australian National University and RMIT.
While it may take years for regulators, governments and companies to make the concept viable, Behncke said the window of opportunity to “get involved and shape the conversation” was still small.
“How it will unfold we don’t know, but what we do know is the innovation is so broad and deep that regulators and governments are going to have to look at this closely, and they’re not going to have all the answers,” he said.
“When you look at how money moves around the world and how it’s evolving, it’s a very global conversation.”
“They’ll have one part of the answers but there’s a lot of other groups that will need to have input on this, and we felt very strongly we need to tap into that.”