October 26, 2020

Mark Zuckerberg speaks in Congress in defense of Libra

Mark Zuckerberg speaks in Congress in defense of Libra

Today, October 23, Mark Zuckerberg appeared before the congressmen, who asked him the questions they were interested in. questions and commented onLibra project. At the hearing, Facebook’s CEO reiterated that he wouldn’t launch a stable currency until all regulators received approval.

Most congressmen have expressedconcern that Libra is headquartered not in the United States, but in Switzerland, as well as regarding previous leaks of private information that have occurred on Facebook. In particular, Congresswoman Velazquez said:

You have lost huge personal informationthe number of your users. You have no guarantee that this will not happen again. Why should we believe that you want to protect the rights of clients when this is obviously not the case?

In addition, some of the board membersConcerned about the possible consequences of launching an anonymous Calibra wallet. According to them, the wallet cannot be completely anonymous and at the same time comply with all necessary standards, such as AML / KYC. In addition, some of them doubted that Libra generally has the potential to comply with these standards, since the large payment systems that were responsible for developing the compliance solutions left the association. Congressman Maloney said:

You are currently creating a new currency,potentially anonymous. With it, it will be possible to hide criminal activity, and this is the number one problem. Obviously, criminals will use Libra. In the event that your wallet is not transparent, its users will often be suspected.

According to the head of Facebook, several paymentcompanies are still members of the Libra Association, in addition, the development of a solution for compliance with the law is carried out by David Marcus personally, who previously led PayPal. He said members of the association have invested billions of dollars in developing mechanisms to combat money laundering and terrorist financing.

In addition, Zuckerberg reiterated that the projectLibra will not be launched until it receives full approval from US regulators as well as regulators from other jurisdictions. According to him, the goal of the project is to create a currency that would use all the advantages of innovative technologies, but would comply with all regulatory standards, which is why compliance with the law is a priority for the project.

Mark also emphasized several times that the newstable coin is not a competitor to sovereign currencies. According to him, Libra will cooperate with central banks around the world so that the project does not harm the monetary system.

Some of the congressmen expressed concernabout the centralization of the association and the consequences of this centralization. However, according to Zuckerberg, the Facebook leadership does not control the Libra Association. The leadership of the social network will not be able to influence the decisions of the members of the association, as well as the process of their selection.

Rep. Rep. Juan Vargassaid the Libra Association could not exist without Facebook. He also noted that most of the key members have already left the association, so the power in the newly created board of directors is wholly owned by Mark Zuckerberg.

It is worth noting that many of the legislatorsnoted the potential of blockchain and cryptocurrencies, and also emphasized the fact that the United States should be the leader in this new area. In addition, many of them expressed the need for the early introduction of clear cryptocurrency regulation.