Today is the day that the big cheese himself, the creator of Facebook Mark Zuckerberg, heads to a hearing with the U.S. House Financial Services Committee in Washington, D.C. to talk about the potential of the Libra stablecoin proposed by the social media giant.
Those who have been paying attention expect Zuckerberg to roll out ideas consistent with Facebook’s past positions, speaking about innovation that he believes could help advance America’s financial industry.
However, others also suggest that Zuckerberg will probably reference some of the skeletons in Facebook’s closet, including concerns by consumers and regulators over both privacy and antitrust issues.
Some of the background is that American legislators have finally begun to think carefully about antitrust concerns with all of the top five tech companies, including Facebook, Apple, Amazon, Google and Netflix. Some of these, like Facebook, primarily offer digital services; others, like Amazon, have taken over large swaths of the retail delivery market.
In addition, there have been a lot of questions about how Facebook treats all of the data that it gathers about users, especially in the wake of new laws like the European GDPR (General Data Protection Rule).
In that context, lawmakers have become reluctant to greenlight the Libra stablecoin, partly out of concerns that it could disrupt the American economy in a bad way by challenging the U.S. dollar and creating economic confusion.
Maxine Waters, chairwoman of the committee, has introduced a “Keep Big Tech Out of Finance Act” that would prevent companies with over $25 billion in assets from offering cryptocurrencies. Waters is just one of many politicians on either side of the aisle calling for the U.S. to hit the brakes on projects like Libra. An initial plan to unroll Libra by 2020 now seems dubious.
With that in mind, legislators have been asking for Zuckerberg to come down and speak directly with government stakeholders to try to sort out rumor and fact around a potential Facebook cryptocurrency.
“It is imperative that we get Mr. Zuckerberg in before the committee,” Rep. Sylvia Garcia (TX-D), said according to a CNN Business piece. “This is his brainchild, his company, he’s the one to have the answers to many of the questions we also raised with (Calibri leader David) Marcus. Some of the questions that he didn’t answer or didn’t answer fully, I think Mr. Zuckerberg is the one to address those … Until they answer our questions, we cannot allow this to go forward.”
We’ll bring you some of the outcomes of Libra talks as they emerge.