The U.S House of Representatives Committee on Financial Services has temporarily prohibited Facebook, along with its associates, to cease any activities related to the progress of Libra – Facebook’ stablecoin project.
As stated in a letter – sent to Facebook founder, leaders and chief operating officer Mark Zuckerberg, David Marcus, Sheryl Sandberg – the governmental department called for an immediate moratorium, which requires Facebook, together with any team working on Libra with it, to cease any progress regarding Libra and its dedicated Calibra wallet.
The committee was afraid that Libra can create “an entirely new global financial system that is based out of Switzerland and intended to rival U.S. monetary policy and the dollar.” The governmental office argued that such prospect can bring negative impacts and consequences.
”This raises serious privacy, trading, national security, and monetary policy concerns for not only Facebook’s over 2 billion users, but also for investors, consumers, and the broader global economy.”
The letter has mentioned potentially exploitable holes in cybersecurity systems, which could lead to the loss of trillions of dollars worth of uninsured funds, and could further leave customers vulnerable to serious privacy and national security problems.
“If products and services like these are left improperly regulated and without sufficient oversight, they could pose systemic risks that endanger U.S. and global financial stability.” The committee mentioned Facebook’s bad reputation in the past, which aggravates the worries.
The committee requested Facebook to halt their “implementation plans”, until thorough assessments have been carried out by regulators. Upon the moratorium, public hearing sessions will be organized to debate the risks and advantages the project can bring, and work on proper regulatory measures, The Crypto Sight reported in June.