In June, Facebook revealed plans for Libra, a cryptocurrency it hopes will shake up the global payments industry. Facebook says it won’t control Libra, and that key decisions will be in the hands of the Libra Association, a group registered in Switzerland with as many as 100 members, each with equal voting power.

“No single organization can, or should, be solely responsible” for Libra, David Marcus, the Facebook executive who leads the Libra project, told the US Senate Banking Committee in July. “We believe a cooperative approach is both warranted and necessary, and we are therefore working to develop the Libra Association: an independent membership-based organization."

"As one member among many, Facebook’s role in governance of the association will be equal to that of its peers,” Marcus continued. “Facebook will have only one vote and will not be in a position to control the wholly independent organization."

But a WIRED analysis finds that 15 of the 27 founding members of the Libra Association are directly or indirectly tied to Facebook. The total includes members that employ former Facebook executives, members whose boards include Facebook board members, and numerous ties through common investors.

Andreessen Horowitz, a venture capital firm that was an early investor in Facebook and whose cofounder Marc Andreessen sits on Facebook’s board, is an investor in four other Libra Association members. Peter Thiel, a Facebook investor and board member, also is an investor in two Libra Association members.

Facebook CEO Mark Zuckerberg is one of two directors of Breakthrough Initiatives, another Libra Association member. The other director is Russia-born tech investor Yuri Milner, who founded Breakthrough in 2015 to support space exploration and the search for extraterrestrial life. Milner’s DST Global was an early investor in Facebook. DST is an investor in four other Libra Association members, and is itself part owned by Naspers, which also owns PayU, another Libra member.

A representative for Milner and Breakthrough declined to respond directly to questions about Breakthrough’s interest in Libra. A spokesperson said only that “Breakthrough Initiatives Limited is an investment vehicle supporting existing and future philanthropic projects in fundamental sciences.” A spokesperson for Andreessen Horowitz declined to answer questions about plans to manage conflicts of interest. A spokesperson for Founders Fund, Thiel’s venture capital fund, says it has no involvement in the Libra Association.

Questions of Independence

The many ties among Libra Association members, and with Facebook, raise questions about potential conflicts of interest and Facebook’s assertion that it won’t control Libra. Daniel Tischer, a lecturer at the School of Management at the University of Bristol in the UK, says Libra looks less like an association of equals and more like “a club run by like-minded, interconnected elites interested in power and profit.”

Primavera De Filippi, a faculty associate at the Berkman Klein Center for Internet & Society at Harvard and author of a book about blockchain technology, says the Libra Association creates “a facade of decentralization, so that no single company can be held responsible for the management of the Libra system.” In practice, she says, “the likelihood of collusion is quite high, and the various association members will likely be tempted to act in a coordinated manner in order to maximize their profits.”

The core idea behind cryptocurrencies is to eliminate the need to trust centralized institutions like banks. Cryptocurrencies such as bitcoin and ethereum operate as distributed computer networks. Anyone can join; users don’t need to trust each other, because they can validate transactions collectively with blockchain technology. By contrast, only Libra Association members will validate transactions on the Libra blockchain, making it a permissioned blockchain. That’s led some to argue that Libra isn’t really a cryptocurrency. Facebook says it wants Libra to move to a permissionless blockchain in the future, but many are skeptical.