The House Financial Services Committee in the United States is set to discuss the future of Facebook’s upcoming cryptocurrency, Libra, on Wednesday.
The head of the committee, Democratic Congresswoman Maxine Waters, last week proposed legislation which details rules that would ban Facebook and other technology firms from developing and launching financial services. Titled “Keep Big Tech Out of Finance Act,” Waters’ bill also discussed the possibility of imposing hefty fines – of as much as $1 million per day – on offenders.
“A large platform utility may not establish, maintain, or operate a digital asset that is intended to be widely used as a medium of exchange, unit of account, store of value, or any other similar function, as defined by the Board of Governors of the Federal Reserve System,” the bill reads.
Big Firms Kept Out of Finance
The proposed legislation follows weeks of outcry over Facebook’s plan to launch a parallel financial ecosystem. The social media giant in June announced Calibra, a payment project backed by the same technology that powers controversial cryptocurrency bitcoin. Lawmakers and regulators jointly opposed Facebook for allegedly attempting to bypass federal systems. Waters, in particular, asked Facebook to stop developing Calibra until further notice.
“If products and services like these are left improperly regulated and without sufficient oversight, they could pose systemic risks that endanger the US and global financial stability,” Water explained. “These vulnerabilities could be exploited and obscured by bad actors, as other cryptocurrencies, exchanges, and wallets have been in the past.”
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Reviewed by Eugene D
on
July 16, 2019
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