US lawmakers bashed Facebook on Wednesday over its planned cryptocurrency, saying the company had not shown it could be trusted to safeguard the world financial system and consumers’ data.
The social media company is fighting to get Washington on its side after it shocked regulators and lawmakers with its announcement on June 18 that it was hoping to launch a new digital coin called Libra in 2020.
It has faced criticism from policymakers and financial watchdogs at home and abroad who fear widespread adoption of the digital currency by Facebook’s 2.38 billion users could upend the financial system.
“I have serious concerns with Facebook’s plans to create a digital currency and digital wallet,” Maxine Waters, chairwoman of the Democrat-controlled House Financial Services Committee, said in her opening remarks.
“If Facebook’s plan comes into fruition, the company and its partners will wield immense economic power that could destabilize currencies and governments.”
Lawmakers on the House Financial Services Committee questioned David Marcus, the Facebook executive overseeing the project, who was grilled by the Senate Banking Committee on Tuesday over the possible risks posed by Libra to data privacy, consumer protections and money laundering controls.
The hearing in Congress proved to be even more tense on Wednesday.
Facebook has been on the defense amid a backlash over mishandling user data and not doing enough to prevent Russian interference in the 2016 US presidential election.