A group of House Democrats on the House Financial Services Committee has called for Facebook to halt its cryptocurrency Libra. More than 30 lawmakers have called for an immediate halt to the development of the Libra project in a letter to Congress yesterday. The letter was also personally addressed to Mark Zuckerberg, the founder of Facebook.
The lawmakers wrote
If products and services like these are left improperly regulated and without sufficient oversight, they could pose systemic risks that endanger U.S. and global financial stability. These vulnerabilities could be exploited and obscured by bad actors, as other cryptocurrencies, exchanges, and wallets have been in the past
The letter calls for a green light from regulators. There are still many questions and uncertainties to clarify the project before you can continue with Libra again.
In addition to concerns over the controversial handling of user data in the past by Facebook, concerns were expressed about a new, Swiss-based, dollar-denominated, global monetary system. User safety and national security were challenged in the letter. The Democrats stated their concerns were only elevated by Facebook’s past privacy scandals, highlighting the accumulation of data from more than 50 million users from Cambridge Analytica during the 2016 presidential election.
Facebook’s Calibra first revealed its proposals for the cryptocurrency last month that would be conducted by the Swiss nonprofit Libra Association and classify from the social media platform. Facebook will be one of the companies with funding and polling power in the project, along with Uber, Mastercard, Spotify, Vodafone, Coinbase and Women’s World Banking.
The lawmakers further stated that because Facebook is already in the hands of over a quarter of the world’s population, it is important that Facebook and its allies rapidly stop implementation strategies until regulators and Congress have a chance to study these dangers and take action.
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