David Marcus, CEO of Facebook’s crypto wallet Calibra, underlined that Facebook would not launch the Libra
cryptocurrency project before they address all regulatory concerns.
Marcus delivered his comments at a hearing on Libra with the Financial
Services Committee of the United States House of Representatives today,
July 17, as reported by a Cointelegraph correspondent.
On the
second day of hearings on Libra’s structure and management, Rep. Nydia
Velazquez asked Marcus, “Will you commit yourself to not launch before
all the concerns from the Federal Reserve and other regulators are
addressed?” In response, Marcus said, “Absolutely.” Rep. David Scott
followed up with a comment:
“Neither your white paper
nor your subsequent Facebook post offered any concrete details as to how
you plan to implement or enforce strong AML [anti-money laundering], how you plan to enforce KYC
[Know Your Customer], and most important, to ensure the safety — and
that’s what all of us are concerned with — of our financial system.”
Rep.
Scott asked Marcus how the company envisions Libra’s responsibility to
combat money laundering to protect the financial system. Marcus said
that “blockchain gives additional information to law enforcement and regulators compared to our current system.”
Marcus
also stated that he believes that they can improve the current system
in order to preclude wrongdoers from using Libra for illicit activity.
Rep.
Jim A. Himes noted that “users will have the profoundly unfamiliar
experience of assuming foreign currency risk” and asked Marcus how the
company is going to make foreign currency risk transparent. Marcus
responded that Facebook will have educational tools built into the product.
As reported
earlier today, committee chair Rep. Maxine Waters opened the hearing
with an indictment of Facebook’s past behavior. In her statement, Waters
noted a “demonstrated pattern of failing to keep consumer data private
on a scale similar to Equifax.”
Waters also stated that Facebook, “allowed malicious Russian state actors to purchase and target ads,” which purportedly influenced the 2016 U.S. presidential elections.
On July 15, a day before the hearing, the Banking Committee released
Marcus’ opening statements, where he stressed Libra and Calibra’s
implications for commerce and consumers. “State financial regulators
will regulate Calibra as a money transmitter, and the Federal Trade
Commission and the Consumer Financial Protection Bureau will monitor for
consumer protection and data privacy and security issues.”
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