As Facebook continues to lay the foundation for getting some of the world’s largest payment processing and technology companies a seat at the global monetary policy table, the company faces significant obstacles to enacting its plans from both sides of the congressional aisle.
US lawmakers bashed Facebook over its planned cryptocurrency, saying the company had not shown it could be trusted to safeguard the world financial system and consumers data. The social media company is fighting to get Washington on its side after it shocked regulators and lawmakers with its announcement on June 18 that it was hoping to launch a new digital coin called Libra in 2020.
It has faced criticism from policymakers and financial watchdogs at home and abroad who fear widespread adoption of the digital currency by Facebook’s 2.38 billion users could upend the financial system. “I have serious concerns with Facebook’s plans to create a digital currency and digital wallet,” Maxine Waters, chairwoman of the Democrat-controlled House Financial Services Committee, said in her opening remarks.
On the other hand, global regulators will not let Facebook launch its Libra currency until all their concerns, ranging from money laundering to financial stability, have been addressed and a prolonged discussion may be needed first, the man in charge of their response told Reuters.
Facebook announced Libra — a new digital coin backed by four official currencies and available to billions of social network users around the world — a month ago, adding that it was hoping to launch as soon as next year. That goal may prove optimistic. Benoit Coeure, the European Central Bank board member who chairs an international working group on Libra, said Facebook’s global reach meant the cryptocurrency had to be safe “from day one” for its users, the financial system and authorities fighting crime.
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18 August, 2019