Regulation

Lawmakers Propose Bill To ‘Keep Big Tech Out Of Finance’

Just days before the Facebook Libra hearings, a draft bill to limit “Big Tech’s” entry into finance and crypto has surfaced online.

The draft discussion bill “Keep Big Tech Out of Finance Act” was leaked July 13 from the U.S. House of Representatives Financial Services Committee, The Block reported. The bill aims to prevent big tech firms from becoming financial institutions.

“A large platform utility may not establish, maintain, or operate a digital asset that is intended to be widely used as medium of exchange, unit of account, store of value, or any other similar function, as defined by the Board of Governors of the Federal Reserve System,” the document said.

The discussion draft defines “a large platform utility” as a tech company that earns annual global revenues in excess of $25 billion.

The leaked bill follows Democrats’ request that Facebook stop developing Libra until Congress researches the risks involved, according to reports.

Chair of the Financial Services Committee Maxine Waters initiated the congressional hearings on Libra in June by calling for a moratorium on the project. Libra is scheduled for hearings before the Senate Banking Committee on July 16 and with the House Financial Services Committee on July 17.

“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,” Waters said in a statement.

Federal Reserve Chairman Jerome Powell spoke to a congressional committee July 10 about the organization’s concerns with Libra.

Talk of new bitcoin rules started surfacing earlier in July with the Internal Revenue Service’s announcement that it is planning updates to its 2014 guidance on cryptocurrencies, reports indicate. The IRS is acting on an April request from a bipartisan group of 20 lawmakers.

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