This article is written by one of our contributor Richard Kastelein.
US House of Representatives politicians are turning up the pressure on Facebook to force Facebook’s Mark Zuckerberg to testify in the coming months about his company’s plans to launch the Libra cryptocurrency, according to a report in the Washington Post today.
Rep. Maxine Waters, chair of The House Financial Services Committee allegedly stated that an Oct. 29 hearing Facebook attended by Zuckerberg’s second in command, Sheryl Sandberg will not happen unless Zuckerberg promises to come before the committee before the new year. This is according to a source familiar with the matter but not authorized to discuss it on record with the Washington Post.
Maxine Waters has consistently criticised Libra as a threat to the US dollar and on the global financial system.
“Facebook has data on billions of people and has repeatedly shown a disregard for the protection and careful use of this data. It has also exposed Americans to malicious and fake accounts from bad actors, including Russian intelligence and transnational traffickers. Facebook has also been fined large sums and remains under a Federal Trade Commission consent order for deceiving consumers and failing to keep consumer data private, and has also been sued by the government for violating fair housing laws on its advertising platform.”
“With the announcement that it plans to create a cryptocurrency, Facebook is continuing its unchecked expansion and extending its reach into the lives of its users. The cryptocurrency market currently lacks a clear regulatory framework to provide strong protections for investors, consumers, and the economy. Regulators should see this as a wake-up call to get serious about the privacy and national security concerns, cybersecurity risks, and trading risks that are posed by cryptocurrencies. Given the company’s troubled past, I am requesting that Facebook agree to a moratorium on any movement forward on developing a cryptocurrency until Congress and regulators have the opportunity to examine these issues and take action. Facebook executives should also come before the Committee to provide testimony on these issues.”
Facebook has hired new lobbyists and taken on five firms to deal specifically with issues related to Libra and blockchain, according to lobbying disclosures revealed by Bloomberg.
Many of those lobbyists are former congressional aides with ties to lawmakers who lead key financial services and banking committees. Four other firms have registered to lobby for Facebook on cryptocurrencies and related issues in the past two months, including John Collins of FS Vector, a lobbying and regulatory compliance firm in Washington. Collins is a former executive with the cryptocurrency exchange Coinbase.