transactions within a
controllable suite of
Facebook apps, giving even
more reason for a business
to buy advertisements there.
Most tech enterprises
attract little attention from
the world at large. Facebook
carried on quietly fueling
the social media boom for
years before attracting
attention from legislators.
The fact that Libra is special
is clear when, months before
even a limited launch, it
attracted comments from
the financial chiefs of the
G7 nations.Why all the fuss?
Because money is power,
and Libra side-steps so
much regulation, and that
has implications. If Libra
gets as big as it plans, it will
put a great deal of power
into the hands of those who
control it. Libra may sound
libertarian – many aspects
are – but it has the potential
to be intrusive, and worse.
The prime mover behind
Libra being Facebook hasn’t
helped bring positive
reactions either. The
company has a terrible
record on privacy; only a few
months ago, it was fined a
record $5 billion for passing
on private data. The records
generated by Libra will be
kept by Calibra, and can’t besharedwithFacebook’s
serverswithout
authorisationusingan
opt-insystem.However,
thereareplansfora
friend-findersearch
function,whichdoesrequire
thelinkingofCalibra
transactionswithFacebook
accounts.Thetrick,it seems,
istogetuserstogive
permissiontoshare
information,through
incitementsofsomesort.
CollectingdataiswhatFacebookdoes,andLibra
willbepartofthatprocess.
Yourfinancialrecordsare
a goldmineforadvertisers.
CanwetrustFacebooknot
toexploitthem?Insurveys,
Facebookdoesnotscore
wellatall.Arecentoneby
NBCandtheWallStreet
Journalhad 60 percentof
peoplenottrusting
Facebookwithpersonal
data,morethantwicethe
figureforAmazon.
Wemaynottrust
Facebook,butwehaven’t
stoppedusingit.Thatfinancialdataisn’tjusta
juicytargetforbusiness,
either– securityforces
wouldbeinterested,too.
TheadventofLibrahas
drawna greatdealof
attentionfromUSCongress,
too.Bankingisa heavily
regulatedindustry,while
techcompanieshave
generallyreceiveda light
touch.Thatlookssetto
change.Facebookhas
movedintodifferentwaters
here.InJuly,theUSSenateBankingCommittee
questionedtheheadofthe
Libraproject,DavidMarcus,
fortwodays.It wasn’tthe
friendliestofmeetings.The
SenatorforOhiosaidthat
thecompanyshowed
“breath-takingarrogance,”
andthatLibrawas“a
recipeformorecorporate
powerovermarkets
andconsumers.”
Facebookdeniesthatit
isa bank,andtherefore
isfreefrombanking
regulations.Whichisjust
aswell,becauseonecommitteemembersaid,
“Ifyou’rea bank,we(will)
regulatetheheckout
ofyou.”
Thereisnota lotoflove
forFacebookonCapitolHill.
It has,asyet,failedtogive
concreteanswersonhowit
willimplementanti-money
launderingmeasures.Basing
theorganisationin
Switzerlandhasdrawn
heavyfire,too(seebox,
p62.)Marcusclaimsthe
locationwaschosento
giveLibraan“international
place,”nottoskirt
regulations.Facebookhas
alsosaidit won’tlaunch
Librabeforetheregulatory
issueshavebeenresolved.
It’snotjustinAmerica
thatLibrafacesproblems.
TheFrenchfinanceminister,
thegovernoroftheBankof
England,andtheSwissData
ProtectionCommissioner
haveallissuedstatements
thatwarnoftheneedfor
regulation.Manycountries
havelawsbanningor
limitingtheuseof
cryptocurrencies;onehuge
marketLibrawashopingto
hitearlywasIndia,butsuch
lawshaveblockeditslaunch
therefornow.
Thepotentialforcriminal
useisanotherfrequently
raisedconcern.Thereare
tightbankingregulationsto
stopmoneylaundering–Look– youcansendmoney
whileonthebackofa bike.
Acheesy,butslick,promo
videostressesLibra’s
simplicityandglobalnature.© LIBRA PROMOTIONAL VIDEO
The Calibra wallet app links into WhatsApp and Messenger.Technology
Facebook Libra
November 2019 | |^61