David Marcus, the man who has come to personify the seismic change in the global financial system, has come a long way to the helm of Facebook’s Libra…
David Marcus, the man spearheading Facebook’s blockchain effort, has gotten a tremendous amount of spotlight lately. The rapid emergence of Libra has dominated the coverage of other crypto-related developments, as it became apparent that the social media giant’s inroad into the realm of digital assets will have most serious consequences for both the blockchain sector and the global financial system in general.
While previously the crypto industry has hardly ever had one key spokesperson — which is perhaps a natural and welcome state of affairs for a domain wherein decentralization is the most cherished of values — Libra’s newfound position at the center of global-level regulatory debate about the future shape of finance propels the project’s charismatic head to serve as the envoy for the whole cryptocurrency space.
Like it or not, old-school legislators in the United States and beyond are used to dealing with specific people representing interest groups and industry associations, so Marcus’ two appearances before the U.S. Congress have likely rendered him not just “Mr. Facebook Cryptocurrency,” but simply “Mr. Cryptocurrency” in the eyes of many people in high offices. But how did a Paris-born, Geneva-raised college dropout end up in this capacity of prominence?
From Geneva to Silicon Valley
Born into a Romanian-Iranian family in Paris, the future head of Libra was raised in Switzerland, where he attended the University of Geneva. Like so many of his future tech industry colleagues, he left school long before earning a degree in order to focus on an entrepreneurial career. At aged 23, Marcus founded his first startup — a telecom carrier — which was acquired by a larger integrated communications corporation after four years under his leadership. His first experience with payments came after he established a mobile media monetization company, Echovox, whose feats, among others, included facilitating SMS voting for big-name TV shows.
Zong, a spin-off from Echovox, has successfully establishing a payments network that allowed users to make purchases through mobile carrier billing. Putting up such a service on a large scale took Marcus negotiating with hundreds of mobile operators and thousands of merchants. It was Zong’s success that projected Marcus to the position of PayPal’s vice president of mobile upon the payment behemoth’s acquisition of the startup. It came in handy that PayPal had been bracing to ramp up its mobile services, for which task Marcus’ experience proved invaluable. In 2012, he was promoted to be the company’s president, directing the explosive growth of one of the world’s largest payment platforms.
In 2014, Mark Zuckerberg seduced Marcus to join Facebook as the head of messaging products. Marcus cited his willingness to go back to managing smaller teams (PayPal counted some 15,000 employees at the end of his term) and to build consumer-facing products and services in a more energetic startup-like environment. Under his leadership, Facebook Messenger substantially grew in terms of the number of active users and saw several improvements in its functionality — including the introduction of tools facilitating the interaction between retailers and their customers, such as chatbots supporting payments.
Marcus led Messenger for four years before the entirely new chapter of his career opened with Facebook’s announcement of him taking charge of the newly established exploratory blockchain task force — the initiative now known as Libra.
David Marcus is believed to be among the first in the world of big tech to start experimenting with cryptocurrencies, as Asaf Fybish, co-founder of blockchain marketing firm GuerrillaBuzz, told Cointelegraph:
“David Marcus is actually considered as one of the first top Silicon Valley executives to adopt and support bitcoin. In 2013, at the LeWeb conference in Paris, Marcus stated the fact that he is a big fan of bitcoin and owns a stash of it. He called bitcoin a store of value and a distributed ledger. Getting this type of support back in 2013 was pretty exciting and we can tell that David has a sense when it comes to blockchain and cryptocurrencies in particular.”
“Digital Gold,” a book authored by journalist Nathaniel Popper, mentions Marcus alongside the founders of the Gemini digital currency exchange (i.e., Cameron and Tyler Winkelvoss), co-chairman of Fortress Investment Group Peter Briger, and entrepreneur Wences Casares as high-profile technology executives invested in Bitcoin since at least 2013. Popper claims that Marcus got so fascinated by the original digital asset that he at some point considered quitting PayPal to launch a cryptocurrency exchange.
In April 2013, Marcus admitted that PayPal was looking into possible ways to incorporate Bitcoin in the payment company’s operations, saying:
“So I’ve been spending a lot of time looking at it, and it’s truly fascinating actually: the way that the currency’s been designed, and the way that inflation is built in to pay for miners, and all that is truly fascinating. I think that for us at PayPal, it’s just a question whether Bitcoin will make its way to PayPal’s funding instrument or not.”
Later the same year, speaking at the aforementioned LeWeb conference, Marcus opined that cryptocurrencies had a greater chance of revolutionizing the payments industry within the next 10 years than, say, NFC tap-to-pay technology.
Although it initially might have seemed that the move to Facebook had lured Marcus much farther away from his cryptocurrency aspirations than he was at PayPal, destiny took him full circle to end up at the helm of the social platform’s blockchain project just a few years later. Some people in the industry draw direct comparisons between Libra and the payments network Marcus once managed. Ruud Feltkamp, CEO and co-founder of crypto trading platform Cryptohopper, told Cointelegraph:
“Here at Cryptohopper, we often asked ourselves: why is nobody creating the ‘PayPal of Crypto’? Great to see it’s actually their former president that is now leading Libra. Regardless of what you think of Facebook, their entrance marks the start of the big companies entering crypto. Next up, Google?”
While at PayPal, Marcus remained in a wait-and-see mode, saying in a 2014 interview that it was critical for a payments company present in more than 90 countries to understand the regulatory implications of starting to accept cryptocurrency across all its jurisdictions. At the time, apparently, he couldn’t see a realistic way to make it happen, as PayPal lacked the consumer base and economic power that enabled Facebook to come up with a global cryptocurrency plan five years after.
One of Marcus’ main competences is gracefully cutting through the miles of red tape that inevitably accompany scaling a global payment system to millions of dollars worth of transactions per minute: He enthusiastically spoke about that facet of his work as early as in 2012. Even before the Libra appointment, this skill had won him a position on the Coinbase board of directors, as the crypto trading platform was scrambling toward the end of 2017 to handle a surge in both crypto prices and the number of crypto investors.
Marcus expressed his enthusiasm for this chance to help Coinbase “democratize access to cryptocurrencies, and deliver on the mission to create an open financial system for the world.” However, his tenure with the exchange only lasted for several months before he had to step down in a move that signaled Facebook’s stepping-up its own blockchain effort.
Prior to unveiling Libra, Marcus projected Facebook’s cautious stance on cryptocurrency — for example, citing the functional hurdles in the way of blockchain-enabled payments — saying:
“Payments using crypto right now is just very expensive, super slow, so the various communities running the different blockchains and the different assets need to fix all the issues, and then when we get there someday, maybe we’ll do something.”
He also sided with Zuckerberg in the wake of the controversial decision to ban all crypto-related ads, supporting the view that most of them were a scam anyway and that the ban has been necessary in order to protect users.
Stephanie So, co-founder and chief development officer of blockchain security startup Geeq, observed to Cointelegraph that Marcus is well qualified for his job, but that this should not eliminate concerns over Libra’s governance model:
“I would say that David Marcus clearly has spent his career running and understanding the payments industry. If there were to be a play for a group of private corporations to start an alternative global currency to dominate retail transactions, Marcus’ experience in finance at the rate of billions of transactions and dollars, and with world regulators might make sense.”
So also agrees with the views that Marcus outlined in his hearing before the U.S. Congress. She said:
“I also agree with what he apparently stated in his Congressional testimony: blockchain technology is inevitable. However, as you know, blockchain technology is not well understood. In spite of most blockchains’ ideological tendencies toward inclusion and self-governance, there are reasons blockchain has not been widely adopted yet, and that is because there are potentially major gaps in their security models, which means (or should mean) that traditional financial institutions should not be ready to move to blockchain yet.”
The real “mensch”
Unlike many tech executives that hold prominent positions in Silicon Valley for decades without openly expressing their views out in the public, Marcus never shied away it — and in quite a passionate fashion. Hill Ferguson, Marcus’ colleague at Zong and then at PayPal, once testified to the Financial Times that the Libra boss is not missing a human element in him, “He can be a great, persuasive person around a vision but he combines that with being a genuinely solid person — or a ‘mensch’, as he would say — and he really is that in the truest sense of the word.”
A notorious, inadvertent expression of how Marcus takes what he does to heart emerged in 2014, when the then-PayPal president lambasted the company’s employees for their reluctance to use PayPal’s own products, calling it “unacceptable” and implying that those who didn’t use the app or forgot the password would be better off to “find something that will connect with your heart and mind elsewhere.”
In another instance, Marcus took to social media to express his rather strong opinions amid the 2018 spat between Facebook management and Brian Acton, the co-founder of WhatsApp. Referring to Acton, Marcus wrote that he found “attacking the people and company that made you a billionaire, and went to an unprecedented extent to shield and accommodate you for years, low-class.”
Overall, a review of Marcus’ record suggests that, regardless of one’s feelings toward Facebook and Libra, he is fairly well qualified to represent the crypto space before the world’s powerful. While his early involvement with Bitcoin attests to the authenticity of his pro-crypto claims, Marcus’ experience with the global payments market and pro-consumer orientation gives hope that he might at least make an honest attempt to steer Libra in the direction of social good.
Source: Cointelegraph https://cointelegraph.com/