Facebook’s lofty plans to create its own currency may already be running into difficulty as US politicians come out in opposition of the move.
US treasury secretary Steve Mnuchin has said he is “not comfortable” with the Libra cryptocurrency that Facebook is currently developing, BBC News reports.
He told a press conference yesterday (15 July) that he believed the currency could be leveraged by “money launderers and terrorist financiers” and said it was a national security issue.
US lawmakers will be grilling a Facebook executive later over its plans for the digital currency #Libra. Treasury Secretary Steven Mnuchin says the company has "a lot of work to do" before it can launch the 💰. @France24_en #F24📺 pic.twitter.com/6tOM6eerKE
— Stephen Carroll (@newstephen) July 16, 2019
Federal Reserve chair Jerome Powell said when speaking to lawmakers earlier this month that he has “serious concerns” about the project. Meanwhile, Trump hinted that Facebook may require a banking licence.
This is one of a series of recent moves by US government that indicate bipartisan resistance to the growing influence and lack of regulation of tech companies.
Democrats in US Congress are also considering a bill that would effectively ban major tech companies from wading into the world of finance by barring them from performing banking functions, potentially putting a major halt to Facebook’s plans.
Yesterday, the Federal Trade Commission meted out its largest fine on record to Facebook for its various privacy missteps, though some commentators have argued that the $5bn settlement pales in comparison to the company’s overall turnover.
In June, a bipartisan bill was proposed that would compel large tech companies such as Facebook and Amazon to disclose the value of the data they collect and store. Dubbed the DASHBOARD Act, it was proposed by US Democratic senator Mark Warner and US Republican party senator Josh Hawley, who also have proposed a GDPR-esque act entitled the Do Not Track Act, which would provide an opt-out option for online tracking.
As the US 2020 presidential election draws closer, many Democratic candidates have come out in favour of more strictly regulating companies such as Facebook or even breaking them up entirely by enforcing antitrust legislation. Senator Elizabeth Warren made such a proposal a core element of her early campaign, which senators Bernie Sanders and Kamala Harris have also expressed agreement with.