Facebook’s Libra Network is still getting a lot of press, but the fact is that some of it is negative. It appears some are worried about the world’s biggest social media platform entering the crypto space.
The Worries Are in About Facebook
Yesterday, Live Bitcoin News reported that members of Congress like Maxine Waters are asking the company to halt all production on its cryptocurrency system, so they can ensure everything is being done correctly and ethically. Fear still floats around Facebook given its ties last year to third parties like Cambridge Analytica, a scandal that caused many people to lose trust in the platform.
Now, there are plenty of regulatory worries centered on Facebook, some of which are coming from the Federal Reserve Bank of Australia. Recently, the bank’s governor Philip Lowe explained that he doesn’t think Facebook has much of a chance in the beginning when it comes to developing a cryptocurrency, and he thinks it will be a while before people trust it enough to use it regularly.
I think there’s a lot of water to flow under the bridge before Facebook’s proposal becomes something that we’re using all the time. There are a lot of regulatory issues that need to be addressed, and they’ve got to make sure there’s a solid business case.
To be fair to Facebook, it appears the company has already consulted with organizations like the Commodity Futures Trading Commission (CFTC), so it seems like the regulatory concerns its facing are something it’s relatively prepared for. Andy Bryant – the co-head of the cryptocurrency exchange Bit Flyer – explained in an interview:
I have no doubt that there will have been regulatory discussions or some ‘pre-approval’ going on behind the scenes. Of course, there will be plenty of areas where we can expect that regulators will ask for further clarity, which has evidently started happening already. However, Facebook’s team will no doubt be fully prepared for this.
How Is All This Going to Work?
Jeff Sloan, the CEO of U.S. payments firm Global Payments, thinks that a regulatory overhaul on the Libra Network would be a great sign that the cryptocurrency arena is being taken seriously, and that Facebook is kept in check in the future. He states:
At the end of the day, it’s important for consumers to have confidence in the systems in which we operate. We’re already highly regulated, so we welcome more prudent regulation, and we welcome a level playing field where our competitors are in the same way.
Others don’t have so many concerns about how Libra will be regulated, but on how it will operate. President and COO of Maker DAO Steven Becker recently expressed worries regarding the currency’s transparency and interoperability, questioning whether they will allow users to see transactions and provide an “open-source blockchain.”