The original goals of Libra were decentralizing control of currency and enabling anonymous or at least pseudonymous payments. One of the top House Democrats wants Facebook to temporarily stop developing Libra Network.
The head of the U.S. House of Representatives Financial Services Committee called for Facebook to halt its Libra plans until Congress and regulators have had a chance to investigate potential risks.
House Financial Services Committee Chairwoman Maxine Waters stated:
“With the announcement that it plans to create a cryptocurrency, Facebook is continuing its unchecked expansion and extending its reach into the lives of its users. Given the company’s troubled past, I am requesting that Facebook agree to a moratorium on any movement forward on developing a cryptocurrency until Congress and regulators have the opportunity to examine these issues and take action.”
Rep. Patrick McHenry, the ranking Republican on the committee, had requested Waters to call the hearing earlier in the day. He said that even though there is a promise for new technology in fostering financial inclusion and faster payments, particularly in the developing world, that they are aware of many open questions as to the scope and scale of the project and how it will conform to our global financial regulatory framework. He said:
“We need to go beyond the rumors and speculations and provide a forum to assess this project and its potential unprecedented impact on the financial system.”
Senator Sherrod Brown, a Democrat tweeted:
Facebook is already too big and too powerful, and it has used that power to exploit users’ data without protecting their privacy. We cannot allow Facebook to run a risky new cryptocurrency out of a Swiss bank account without oversight. https://t.co/IjZOFNai3r
— Sherrod Brown (@SenSherrodBrown) June 18, 2019
Sen. Mark Warner, a Democrat said:
“The idea that we are going to turn over our financial data and information to that company, I think they have a big uphill effort to try to convince Americans that they ought to trust in Facebook’s proprietary interest in keeping your data secret.”
Facebook’s Libra didn’t go well as expected in France as well. French Finance Minister Bruno Le Maire said the digital currency known as Libra shouldn’t be seen as a replacement for traditional currencies. He said:
“It is out of question that Libra become a sovereign currency. It can’t and it must not happen.”
However, somewhat more tender was Bank of England Governor Mark Carney who said:
“Anything that works in this world will become instantly systemic and will have to be subject to the highest standards off regulation. We need to have an open mind about technology that can facilitate cross-border money transfers, but we will look at it very closely and in a coordinated fashion at multilateral organizations including the G-7, the International Monetary Fund, Bank for International Settlements and Financial Stability Board.”
Markus Ferber, a German member of the European Parliament, said that Facebook, with more than 2 billion users, could become a “shadow bank” and that regulators should be on high alert.
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