This was probably not the week Facebook had expected, post-Libra.
You know, by now, that the social media giant unveiled the details of a new cryptocurrency, ambitious in scope and with the promise to bring financial inclusion to billions around the globe.
But lightning-quick, the regulators came out in full force, also globally. They are concerned about privacy – particularly, the reach into financial lives, chiefly through Calibra, Facebook’s digital wallet. The calls for a moratorium on Project Libra have come from Rep. Maxine Waters, chairwoman of the House Financial Services Committee, who set a hearing on Libra. The caution surrounding the launch can be seen in the fact that shares were up on the announcement, then drifted lower and have been off slightly through the past several days.
Beyond the U.S., Bank of England Governor Mark Carney has said there is an open mind about the crypto, but that close scrutiny lies ahead.
In the meantime, as noted in this space, data breach issues still swirl around the company. In the last few days, a federal judge ruled that the case against Facebook tied to negligence over a September data breach that hit millions of customers can proceed. In his ruling, U.S. District Judge William Alsup said the case should move toward trial and discovery conducted “with alacrity … from a policy standpoint, to hold that Facebook has no duty of care here ‘would create perverse incentives for businesses who profit off the use of consumers’ personal data to turn a blind eye and ignore known security risks.”
No easy week, no victory laps. No easy road ahead.
POS installment: Visa is bringing installment lending to digital and physical points of sale through APIs, helping a $1.2 trillion market get bigger and grow faster. As many as 74 percent of U.S. cardholders say installment lending helps them budget more effectively.
Tokenization: Visa bought Rambus’ ticketing and tokenization businesses, which means tokenization moves beyond the cards … to any type of transaction, across networks and rails, globally.
PayPal: Payments ecosystems expand when former payments rivals link up – and then expand their collaborations. Google Pay has added PayPal integration for merchants. Merchants who accept Google Pay in 24 countries can now accept payments through mobile wallets from PayPal (and well beyond Google services).
Cryptos: Aside from a sizzling bitcoin rebound from pre-Libra lows, security issues linger. In Singapore, crypto exchange Bitrue was hacked for more than $4 million in cryptocurrencies.
Chinese consumer spending: One of the key engines of retail spending within China – and for luxury goods merchants in the United States – seems to be slowing, as the trade war pinches pocketbooks.
Shopify: Shares in the company dropped nearly 9 percent in a single day after an analyst downgrade took note of valuation amid a strong competitive environment.