Mark Your Calendar: Senate Banking Committee Scheduled Hearing on Facebook’s “Libra” for July 16
- The Senate will be holding a hearing on Facebook’s Libra currency next month
- No witness list as of yet
- On Wednesday, the Senate Banking Committee scheduled a hearing over Facebook’s plan to introduce a new cryptocurrency called “Libra.”
The hearing entitled “Examining Facebook’s Proposed Digital Currency and Data Privacy Considerations,” will take place next month on June 16, with witnesses yet to be announced.
Facebook announced its plan to launch the cryptocurrency on Tuesday via a website and whitepaper that promotes the fiat backed stablecoin as a way to make transfer money as easy as sending a text message.
However, the company's plan met with hard criticism from the lawmakers and further calls for investigation into the potential consumer risks.
“Mark your calendar. Looks like @davidmarcus is going to Congress to explain #blockchain to a room full of grandparents. July 16th should be fun,”
eToro’s senior analyst Mati Greenspan said.
“We Cannot Allow Facebook To Run A Risky New Cryptocurrency”
Senator Sherrod Brown (D-OH) is the top Democrat on the Committee who was also one of the first lawmakers to question Facebook’s new product who has been criticizing the company over its data handling privacy.
In a letter last month, Brown along with Senate Banking Committee Chairman Mike Crapo (R-Idaho) pressed Facebook over its crypto plan, posing questions about how the company plans to protect the financial data of consumers.
“Facebook is already too big and too powerful, and it has used that power to exploit users’ data without protecting their privacy,”
Brown said Tuesday.
“We cannot allow Facebook to run a risky new cryptocurrency out of a Swiss bank account without oversight. I’m calling on our financial watchdogs to scrutinize this closely to ensure users are protected.”
As we reported, senators’ colleagues Chairwoman Maxine Waters (D-CA) and Patrick McHenry (R-NC) have also requested a hearing. Both have called for the social media giant to testify before the House Finance Committee, Waters even asked the company to put a “moratorium” on its development of the currency until Congress and the regulators investigate potential privacy and financial risks.
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’re Trying To Draw A Bright Red Line.”
In response, a Facebook spokesperson said, “We look forward to responding to lawmakers’ questions as this process moves forward,” but they have no plans to pause development on Libra.
“Libra’s mission is to enable a simple global currency and financial infrastructure that empowers billions of people,”
the white paper of the cryptocurrency reads.
Facebook says in the release that the cryptocurrency, that is supported by over two dozen major corporations including MasterCard, Visa and Uber would be operated by Switzerland headquartered non-profit Libra Association that would work separately from the social media platform.
The company is launching a subsidiary called Calibra that is tasked with developing and rolling out Libra. Executives are assuring that none of the financial customer data collected by Calibra would be shared with any of Facebook’s subsidiary.
“Your social data on Facebook is kept separate from Calibra data,” Kevin Weil, Calibra’s vice president of product, said. “This is not about improving ad targeting. We’re trying to draw a bright red line.”