US lawmakers ask to pause the cryptocurrency of Facebook
One of the US lawmakers has urged Facebook Inc. to halt the development of its new cryptocurrency and that company executives testify before Congress first, due to concerns about the implications of the use of the digital currency with respect to to the privacy of the data and its security.
Maxine Waters, who heads the Household Financial Services Committee of the United States Congress, said Facebook should stop developing its product, called Libra, until the congress and regulators can analyze it, and also called on company executives. to testify before Congress.
“Facebook has the information of billions of people and has shown a reiterative disinterest in the protection and care over the use of this information”, “With the announcement of its plans to create a cryptocurrency, Facebook is continuing its unbridled expansion and extending its reach in the lives of its users”,
The comments came after Rep. Patrick McHenry, the Republican director of his panel, also sought a hearing on Facebook’s new initiative. A representative of Facebook said that the company is attentive to answer all the doubts of the legislators.
The announcement of Facebook has presented an immediate rejection by US lawmakers and several regulators around the world, who are concerned that Facebook is already quite dominant and neglected with the privacy of its users.
“Facebook is really very big and powerful, and it has used that power to exploit the information of its users, without protecting their privacy. We can not allow Facebook to develop a new cryptocurrency, such as a Swiss bank account without surveillance”, Senator Sherrod Brown, the Democratic leader of the Senate Banking Committee, said in a statement.
US Senator Mark Warner, a Democrat from Virginia who also belongs to the Senate Banking Committee, expressed his concerns about Libra, since Facebook is using its domain in social networks to achieve a predominance in parallel markets such as mobile payments. These have been at least three of the legislators who have spoken before the cryptocurrency project of Facebook.
French finance minister Bruno Le Maire called for greater regulation of technology companies.
“This instrument for transactions will allow Facebook to collect millions and millions of data, which strengthens my conviction that there is a need to regulate the digital giant”, he said in an interview for radio Europe 1.
However, the governor of the Central Bank of England, Mark Carney, said he is “open-minded” about the potential usefulness of this product, while warning that it may face strict regulation.
Facebook has met with regulators in the United States and other regions to talk about their cryptocurrency project, company executives said. They did not give details about which regulators they have contacted.
A source from one of the US regulators summarized that Facebook has been in communications with several regulators, but added that it was not yet clear how the cryptocurrency would be structured and whether it will be directly subject to any existing regulatory regime in the United States.
Financial representatives of the Swiss government said they were contacted by promoters of the Libra project, but declined to comment on whether they obtained any permit or regulatory status.
Markus Ferber, a German executive legislator in the European Parliament, said Facebook’s new currency should put “regulators on high alert” and called on the European Commission to start a regulatory framework for virtual currencies.
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