CEO of Libra backer eBay says the digital coin is worth the gamble

EBay CEO Devin Wenig told CNBC on Thursday that the online marketplace’s backing of the proposed Libra digital coin is a risky move, but the potential payoff is well worth it.

“Will Libra work? I think it is speculative,” Wenig said on “Squawk on the Street.” “We all know that. But it is promising, and it’s worth a try.”

Last month, Facebook announced an ambitious effort to create the Libra digital currency, with launch plans in early 2020. A nonprofit association, not Facebook, will run Libra, which will be supported by a range of companies and organizations, including eBay, as well as Visa, PayPal, Lyft, Uber and Spotify.

“We are sponsors of this, in part, because crypto and blockchain in particular have great promise,” said Wenig. “A well-run public blockchain that the marketplaces adopt could do immense good.”

The goal of blockchain — the online ledger technology underlying bitcoin and other cryptocurrencies, including Libra — is to make it as easy to send money across the world as it is to send a photo.

Libra differs from the decentralized nature of bitcoin, which can be highly volatile in price and derives value from factors including its ability to enable instantaneous, anonymous, global payments and as an investment. Libra will be pegged to a basket of government-backed money and assets, with the aim of making it stable.

However, Libra has faced scrutiny from several high-profile lawmakers and politicians, including President Donald Trump and Treasury Secretary Steven Mnuchin. This week, David Marcus — head of Facebook’s Calibra digital wallet, which will be used to store Libra — was grilled on Capitol Hill.

“Legitimate questions have been raised by regulators,” Wenig said. “We’ll let Facebook respond to those.”

Wenig appeared Thursday on CNBC as eBay shares were moving solidly higher after the company late Wednesday raised its profit outlook and reported better-than-expected quarterly results.

Be the first to comment

Leave a Reply

Your email address will not be published.