The U.S. Senate Banking Committee will hold a hearing on July 16 about Facebook’s new cryptocurrency, Libra. The hearing came after members of Congress said there is a need to more closely examine Libra and its potential risks.
The hearing, called “Examining Facebook’s Proposed Digital Currency and Data Privacy Considerations,” is set for July 16th, but the committee has yet to decide who exactly will be testifying.
The hearing should be based on investigating the Libra project “as well as any data privacy considerations it may raise.” While no witnesses have been formally announced, a source told Reuters that Facebook’s point man on blockchain, David Marcus, can be expected to testify at the hearing. He recently said:
“The network will be available globally when it’s ready, and then it’s up to individual wallets to decide whether to go global or focus on specific countries. Facebook is now in the process of obtaining the appropriate licenses … in order to operate in as many geographies as we possibly can.”
Just for a reminder, Facebook is working with 27 partners on this project, all of them member of Fortune 500, and its subsidiary Calibra is set to launch a Libra wallet on Messenger, WhatsApp, and another standalone app in 2020.
First country they choose to start work in will probably be countries where banking and money-transfer services often come with exorbitant fees and where Facebook serves as the primary portal to the internet for millions of people.
After the news about hearing was announced, senator Elizabeth Warren tweeted:
Facebook has too much power and a terrible track record when it comes to protecting our private information. We need to hold them accountable—not give them the chance to access even more user data. #BreakUpBigTech https://t.co/eQr06VMMyx
— Elizabeth Warren (@ewarren) June 19, 2019
“We need to see exactly what their specific proposals are, but I’m very concerned about Facebook’s behavior on a range of fronts. I’m concerned about their size, I’m concerned about their anti-competitive conduct, I’m concerned about their rampant violations of privacy.”
He added that there needs to be an antitrust investigation and that in the meantime, if it’s just a fine of a few billion dollars, that’s a speeding ticket to Facebook.
Jerome Powell, chairman of the U.S. Federal Reserve, confirmed that Facebook met with the central bank in the run-up to the reveal of its Libra cryptocurrency.
He was a little bit more gentle on the company saying there is a long way for potential effects on monetary policymaking to happen and “digital currencies are in their infancy.” He said:
“So essentially…not too concerned about the central banks no longer being able to carry out monetary policy because of cryptocurrencies or digital currencies.”