Republican and Democratic Senators sharply questioned Facebook Inc.’s plan to create its own digital money, adding to a chorus of skepticism across Washington and underscoring the challenges the company faces in getting its cryptocurrency off the ground.
At a hearing Tuesday before the Senate Banking Committee, lawmakers compared the social media giant to a toddler playing with matches who burns the house down, blasted it for repeatedly violating consumers’ privacy and accused the company of cheapening social discourse and polarizing America. Many expressed incredulity that Facebook would be able to safeguard people’s finances.
“Do you really think people should trust Facebook with their hard earned money?” Ohio Senator Sherrod Brown, the top Democrat on the banking panel, asked. “I just think that is delusional.”
Senate Banking Committee Chairman Mike Crapo, an Idaho Republican, credited Facebook for trying to build a faster and less expensive way for consumers to move money around the world, but said he was concerned about the company’s "massive reach and influence" and the vast amount of personal information it keeps.
‘Get This Right’
Facebook’s top executive on the project David Marcus pledged to address their concerns about the token, called Libra. "We will take the time to get this right,” he told the committee, testifying in a packed hearing room.
The senators’ ire isn’t coming as a surprise to the company, which has been reeling after a series of privacy breaches and questions about its role spreading fake news in the 2016 presidential campaign. Among the critics of its crypto plans are President Donald Trump, his Treasury chief Steven Mnuchin and Federal Reserve Chairman Jerome Powell.
Even as the rhetoric rose, Tuesday’s hearing focused attention on how cryptocurrencies should be overseen by the federal government. At least a half dozen agencies, including the Fed, the Securities and Exchange Commission and parts of the Treasury, have some say in the matter but none has taken a lead role.
Authorities across the world have been struggling to figure out how to police virtual coins, which are often used in money laundering and other criminal activities. Some such as Bitcoin have become hugely popular among speculative traders.
“It’s a good idea for us to explore this because quite honestly cryptocurrency now is still kind of the wild, wild west that is not well regulated,” noted Thom Tillis, a North Carolina Republican.