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Congress Demands Facebook Halt Work on the Libra Cryptocurrency

Last Updated March 4, 2021 2:37 PM
Luke Luby
Last Updated March 4, 2021 2:37 PM

High-ranking legislators in Congress have issued a thundering rebuke to Facebook’s cryptocurrency ambitions, demanding that the Mark Zucker-berg led firm “immediately cease” work on Libra until the government says otherwise.

House Democrats Demand That Facebook Halt Its Crypto Project

facebook cryptocurrency libra
House Democrats want to press pause on Facebook’s cryptocurrency ambitions. | Source: REUTERS / Dado Ruvic

In a letter  published on July 2, Maxine Waters and other Democrats on the House Financial Services Committee ordered Facebook to halt the release of Libra until Congress can hold public hearings to assess the risks – and benefits – of the cryptocurrency.

“Because Facebook is already in the hands of over a quarter of the world’s population, it is imperative that Facebook and its partners immediately cease implementation plans until regulators and Congress have an opportunity to examine these issues and take action.”

Non-profit organizations ranging from Americans for Financial Reform to Public Citizen and Consumer Reports had called for a moratorium on Facebook’s Libra in a Citizen.org petition , arguing that the government must determine whether Libra is “too dangerous” to be released into the wild.

“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 Citizen.org petition warned that Facebook’s cryptocurrency could have dramatic consequences for consumer protection, online privacy, and law enforcement.

According to the House Financial Services Committee’s website, Maxine Waters plans to convene a hearing on Facebook’s cryptocurrency on July 17.

John McAfee: Libra is a ‘Grotesque Distortion’ of Cryptocurrency

Facebook’s Libra play has also received withering criticism from John McAfee. Taking to Twitter, McAfee claimed that it’s a “grotesque distortion” of cryptocurrency technology.

He notes that a “digital identity” will be needed to use the currency, which isn’t required with bitcoin and other public cryptocurrencies.

Who Develops Facebook’s Libra?

Despite its close association with Facebook’s brand, Libra isn’t developed directly by the company.

Instead, this has been handed over to the Libra Association, based in Switzerland, which has multiple backers, including Lyft and Vodafone.

Facebook is just one partner, although it pays the majority of the staff. This has led many to allege that the social media giant retains most of the control in the Geneva-based company.