Published: Thu, July 04, 2019
Markets | By Otis Pena

Facebook's cryptocurrency project Libra could appeal to some progressive lawmakers

Facebook's cryptocurrency project Libra could appeal to some progressive lawmakers

An open letter signed by 5 U.S. Congress representatives is calling for a moratorium on the Libra cryptocurrency project spearheaded by Facebook and supported by several other global corporations.

The letter by Congress claims that Facebook and its 27 partners (expected to reach 100 by 2020) is trying to build an entirely new financial system based out of Switzerland and meant to rival the U.S monetary policy and the dollar.

"All of us believe the risks posed by Facebook's proposal are too great to allow the plan to proceed with so many unanswered questions", the groups said.

Australia welcomes help to find man missing in North Korea
He also maintains a high profile on social media , where he has been largely upbeat about his experiences in North Korea. American university student Otto Warmbier died in June 2017, less than a week after Pyongyang sent him home in a coma.

Ever since the news broke out, Twitter has been buzzing with the update. "This raises serious privacy, trading, national security, and monetary policy concerns for not only Facebook's over 2 billion users, but also for investors, consumers, and the broader global economy", reads the committee letter, which was sent to Facebook bosses on Tuesday. The Libra Association is based in Geneva, Switzerland and is backed by several companies including Mastercard, PayPal, Visa, Uber, and Spotify. The US Congress has asked the company to pause the cryptocurrency.

Critics pointed out that Calibra's terms of service indicate that Facebook could use it to share user information and account data in certain circumstances. But with Facebook not exactly having the best reputation when it comes to respecting privacy, and the fact it already has so much global influence, there are concerns over Libra. In a detail note, Mr.Marcus explained, decentralization queries revolve around Libra, claiming that Libra is definitely not as open as Bitcoin, the mission behind Libra Association, why billions of people can not access to current financial services and henceforth the emergence of Libra and eventually pinpointing at their plans to engage with regulators and lawmakers. If products and services like this are left improperly regulated and without the proper oversight, it could pose risks to US and global financial stability, the politicians argue. The main concern seems to be similar to that attached to all cryptocurrency, that it will provide liquidity to "bad actors".

It is anticipated that hearings will take place July 17, but it is unlikely the matter will end. "We look forward to working with lawmakers as this process moves forward, including answering their questions at the upcoming House Financial Services and Senate Banking Committee hearings", a Facebook spokesperson told us over email.

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