The Democrats of the House Financial Services Committee have officially written the leadership of Facebook to ask them to stop the Libra cryptocurrency plan and its associated Calibra wallet plans, citing risks to security, financial stability and risks to the control the government of the United States has over monetary policy.
The letter was singed by committee chair Maxine Waters as well as by Reps. Carolyn Maloney, Lacy Clay, Al Green and Stephen Lynch.
“It appears that these products may lend themselves to an entirely new global financial system that is based out of Switzerland and intended to rival U.S. monetary policy and the dollar. This raises serious privacy, trading, national security and monetary policy concerns for not only Facebook’s over 2 billion users, but also for investors, consumers, and the broader global economy,” the letter says.
The letter goes on to state that products of the type Facebook is developing could easily pose “systemic risks that endanger the U.S. and global financial stability” if left without proper oversight or regulation.
“These vulnerabilities could be exploited and obscured by bad actors, as other cryptocurrencies, exchanges and wallets have been in the past.”
And in partisan Washington where agreements are few and far between, it seems on this issue there is agreement: Republicans don’t seem too excited to let Facebook have its own currency either. Senate Banking Chair, Republican Mike Crapo, has scheduled a hearing with Marcus for July 16th, citing concerns over the currency and the potential risks for data privacy it poses. The following day, Waters’ committee will also hold a hearing on the project.
In the meantime, however, House lawmakers have been clear-verging-on-blunt as to their opinions on Facebook’s new project: Facebook needs to call it quits, at least until the relevant regulatory bodies have been brought up to speed and an action plan for going forward is in place.
“Because Facebook is already in the hands of over a quarter of the world’s population, it is imperative that Facebook and its partners immediately cease implementation plans until regulators and Congress have an opportunity to examine these risks and take action,” the letter says.