The chairwoman of the House Financial Services Committee, Maxine Waters, announced on Monday that it will hold a hearing on July 17 to review Facebook’s plans for Libra, the tech giant’s new cryptocurrency-based payments platform that it expects to roll out in 2020 for billions of users worldwide. Since Facebook officially announced the upcoming launch of Libra last week, it has triggered an onslaught of criticism and concern from regulators and policymakers around the globe.
The new cryptocurrency, a stablecoin that is pegged to multiple currencies, has the potential to make a major impact on the global financial system. It will allow people to move money around, both domestically and across borders, without a bank. The Libra coin has been called a threat to banks and the US dollars. Facebook, however, calls it a revolutionary way for people to send money around the world as easily as sending an email.
In addition to the Financial Services Committee, the Senate Banking Committee will hold another Facebook Libra hearing on July 16.
Project leader and blockchain specialist David Marcus, who helms the Libra initiative, is expected to testify at both hearings.
The Hill reports that Facebook is fully prepared to answer questions in order to leverage its global user base to transform the financial services industry. In an email reply, the social media giant says,
“We look forward to responding to lawmakers’ questions as this process moves forward.”
Despite the fact that the project will be operated by a non-profit entity comprised of 27 companies, known as the Libra Association, US legislators are doubling down on efforts to put the brakes on the entire project. House members claim that the massive crypto initiative is not well understood and that given Facebook’s history of compromising its users’ private data, there needs to be strict oversight — in the United States.
Waters notes that the Libra Association is registered in Switzerland and that from its seat abroad, organizers intend to challenge the US dollar by leveraging Facebook’s scope, size, power and userbase, and by offering new financial services.
Speaking last week on CNBC’s “Closing Bell”, Waters sounded the alarm bell.
“This is like starting a bank without having to go through any steps to do it. And of course, we have some questions about Facebook and some of the ways that it has conducted itself in the past. But they’re creating their own cryptocurrency. They’re going to be located in Switzerland. It’s going to be an alternative to the dollar.
And so yes, I think it’s very important for them to stop right now what they’re doing so that we can get a handle on this.”
Facebook is showing no signs of slowing down. It is currently looking for a regulatory policy expert. Today it posted a new listing for qualified applicants. According to the listing,
“Facebook is looking for a Public Policy Manager, Regulatory to set and lead payments and blockchain regulatory policy development for the global public policy team. The successful candidate will work closely with, and support a cross-functional team working on the new initiative. The ideal candidate will have expertise in emerging payments, commerce, blockchain, digital identity, cryptocurrency, and related policy issues, as well as experience working on technology policy issues generally.”