Facebook CEO Mark Zuckerberg will appear
before Congress later this month to talk about
the company’s plans for Libra. Rep. Maxine
Waters, the California Democrat who heads
the House Financial Services Committee where
Zuckerberg will testify on Oct. 23, called Libra
“a new Swiss-based financial system” that
potentially is too big to fail and could require a
taxpayer bailout.
Libra’s supporters say it could open online
purchasing to millions of people who do not
have access to bank accounts and could reduce
the cost of sending money across borders. It’s
easy to see how attractive an alternative like
Libra could be to people in countries beset with
hyperinflation, such as Venezuela and Zimbabwe.
But Facebook already faces scrutiny over its
poor record on privacy and its dominance in
social media, messaging and related businesses.
Will people trust it to create a new, global
currency? Libra also poses new questions for
the social network: Given that cryptocurrency is
lightly regulated now, if at all, how will financial
regulators oversee Facebook’s plan? And just
how much more personal data will this give the
social media giant, anyway?
Litan said Facebook can still easily launch Libra
in countries with no pushback, of which there
are plenty. She also dismissed the idea that
Facebook needs partner companies such as
MasterCard or Visa in order to keep Libra afloat.
“The only reason they want the companies is
because it looks good,” she said. “It was never
a democratic blockchain. It was always run by
Facebook and a couple of financial companies
that were going along for the ride.”