Now that the Libra white paper has been published, The Block has outlined how to become a Founding Member and the requirements it entails. Libra will be administered by a non-profit Libra Association based in Geneva, Switzerland, which will ultimately have 100 geographically diverse founding members. No member will be able to represent more than 1% of the vote.
The Block led early reporting identifying the founding 27 members, a group consisting of organizations from industries including payments, technology/marketplaces, telecommunications, blockchain, venture capital, non-profits, and academic institutions.
Members of the Libra Association will be the validator nodes that operate the Libra Blockchain and form the Libra Association Council that will direct the Association. The validators are what secure the network and confirm transactions. At first, only founding members will be able to operate validator nodes, but eventually membership in the Association, and the ability to operate nodes, will be open to any holder of the Libra currency.
To be a validator node and founding member, organizations will need to meet technical requirements and specific evaluation criteria. If the conditions are met, upon approval, the Enterprise will have to make an initial minimum investment of $10 million worth of Libra Investment Tokens issued by the Association. Nonprofits will not be required to make the initial investment. However, they will have to cover the costs to run its node. It is estimated that the price for running the validator node will run approximately $280,000.
Validators will have the option to run their node self-hosted, in which they themselves would be directly managing it, or cloud service-hosted, where the organization could run the node via a cloud service provider.
Must meet two of the following criteria:
- More than $1 billion USD in market value or more than $500 million USD customer balances.
- Reach more than 20 million people a year, multinationally.
- Be recognized as an established top-100 industry leader by a third-party association. Examples would include the Fortune 500 and the S&P Global 1200.
Crypto-focused investors and Blockchain infrastructure companies criteria
Since the blockchain industry is still very much in its infancy, there is some leeway and separate criteria requirements for crypto investors and blockchain companies. While these criteria exist, no more than one-third of the total members in the association can be made up of this category.
Crypto-focused investors would need to have more than $1 billion of assets under management. Blockchain infrastructure companies would need to have been in operation for over 12 months, have enterprise level operations pertaining to security, privacy, and infrastructure, and be staking or custodying $100 million or more of assets for clients.
It is also noted that the association could make an exception for a pertaining business upon approval of the council if it feels a certain organization would make a meaningful contribution to the network.
Social impact partner and academic institution evaluation criteria
Nonprofit and multilateral organizations will also have a different set of criteria to meet to be a Founding Member. The organization will need to meet at least three of these requirements:
- A willingness to serve the unbanked and underbanked, possibly by the use of blockchain technology. The organization has to have been working on poverty alleviation for at least five years and needs to have an initiative already planned surrounding digital financial inclusion.
- The organization needs be global, or needs to address a geo-specific demographic that is currently underbanked or unbanked.
- The charity has to display a level of trust that is recognized, credible, and must demonstrate a proven track record of social impact.
- An annual operating budget of more than $50 million USD
Academic Institution Evaluation Criteria
Academic Institutions will also have the chance to be founding members. The set of criteria for academics will be a top-100 ranking by QS World University Rankings and also be ranked in the top 100 for its computer science department by CSRankings.
The Libra Association already includes the likes of Visa, Mastercard, PayPal, investors such as Andreessen Horowitz and Union Square Ventures, cryptocurrency exchange Coinbase, and non-profits including Mercy Corps. Now that we know the requirements and costs to be a founding member, it will be interesting to see how this all unfolds and what other organizations will join as initial members.