Tencent Says Libra Would Pose Serious Threat to Alipay, WeChat Pay

Tencent, the Chinese internet giant and parent of messaging app WeChat, said the proposed launch of Facebook's Libra cryptocurrency would pose serious risks to existing digital payment systems.

In a blockchain whitepaper published in Chinese this week, Tencent said Facebook's Libra initiative seems "Bold and radical" but is actually a "Prudent and rational" move for the Silicon Valley giant.

"Any internet company that has a relatively mature digital payment system, such as WeChat Pay and Alipay, would be threatened by the stablecoin if it is ever launched," the whitepaper reads.

Neither Tencent nor Alibaba, which operates WeChat Pay's competitor Alipay, is involved in any known cryptocurrency or trading projects.

With more than 1 billion active daily users on Tencent's social media WeChat, its digital payment spinoff WeChat Pay is one of the two leading companies in the industry, along with Alipay, the mobile payment affiliate of Alibaba Group.

"WeChat Pay does not support crypto trading, and the platform has never been open to any crypto category," the company's official account said in a post on Weibo.

"We welcome users to report on any crypto trading on our platform and proactively collaborate with authorities to crack down on such activities," WeChat added in the post.

Alipay also reiterated its ban on crypto trading in a recently tweet directed at Binance when the exchange enabled over-the-counter trading that would allow Chinese users to exchange crypto assets with a counter-party and settle payments via peer-to-peer transactions on Alipay.

WeChat parent Tencent has been building a suite of blockchain services since they released their first white paper in 2017.

"The launch of Libra would significantly affect the course of global expansion for digital payment companies, especially for those who are not in the Libra consortium," Tencent's whitepaper said.