The Political Pressure on Facebook’s Libra Continues
- A lengthy back-and-forth focused once again on privacy and money laundering issues.
- More predominant this time were comparisons of Libra to a bank, suggesting the project should be regulated as one.
David Marcus, head of the Libra project, speaking at the Facebook F8 Developers conference on April 2017. Facebook
During the hearing on Libra with the Financial Services Committee of the United States House of Representatives, David Marcus, CEO of Facebook’s crypto wallet Calibra, stated that Libra will not be launched before all regulatory concerns were addressed.
This is the second day of the hearings on Facebook’s Libra project and it started with the committee’s chairwoman Rep. Maxine Waters once again asking Facebook to sign a moratorium, stating “until Congress enacts an appropriate legal framework to ensure that Libra and Calibra do what you claim it will do”. Marcus did not agree to the moratorium, but did answer that they will “take the time to get this right.” At one point Rep. Carolyn Maloney raised the same question, to which Marcus responded the same way.
One question that received an “Absolutely!” answer from Marcus was from Rep. Nydia Velazquez, who asked “Will you commit yourself to not launch before all the concerns from the Federal Reserve and other regulators are addressed?”
When the question of money laundering, and how Libra will protect the financial system came up from Rep. David Scott, Marcus once again pointed out that to open a Calibra account a person will need to go through a KYC program, and upload a government issued ID. He also said that blockchain technology can provide additional information to law enforcement and regulators, compared to the current system.
Rep. Jim A. Himes pointed out that the Libra’s basket of currencies will make its user experience “foreign currency risk “, and then asked how will the company make this risk transparent. Marcus assured the representative that Facebook will have educational tools built in place to inform Libra and Calibra’s users. During this exchange, Marcus also mentioned that the 50% of the “basket of currencies” will consist of USD.
Throughout the hearing, numerous representatives asked if Libra, and the Libra association, should be regulated as a bank, considering that some of its services will be similar to that of a bank. Marcus repeatedly answered that Libra will be a payment tool, and does not wish to compete with banks, but should it ever enter into providing banking services, then yes, at that point it should be regulated the same way.
- Crypto.com has once again expanded its regulatory achievements with the acquisition of a major payment institution license for digital payment token services in Singapore.
- The license, for which the company received an in-principle approval last June, enables the exchange to provide a greater range of payment services in Singapore.
Shutterstock
- The current governor of Florida, Ron DeSantis, announced he is joining the race for the 47th president of the U.S. during a Twitter Spaces event on Wednesday.
- During his speech DeSantis declared his support for Bitcoin and the wider crypto space, noting that if Joe Biden is re-elected “they’ll probably end up killing it”.
- All virtual asset service providers (VASPs) in the UAE are now required to submit a licensing application with the Securities and Commodities Authority.
- Firms that have already acquired a license in the UAE’s financial free zones will be exempted from the requirement, but those in Dubai will still need to apply with the SCA.