U.S. lawmakers say Facebook cannot be trusted to manage cryptocurrency
Reuters
Published Oct 19, 2021 05:06PM ET
By Kanishka Singh
(Reuters) - A group of U.S. lawmakers said Facebook Inc (NASDAQ:FB) cannot be trusted to manage cryptocurrency and urged the social media platform to discontinue immediately a small pilot of its cryptocurrency wallet named Novi, which was launched on Tuesday.
U.S. Democratic senators Brian Schatz, Sherrod Brown, Richard Blumenthal, Elizabeth Warren and Tina Smith voiced their opposition to Facebook's two-year-old effort to launch a cryptocurrency and digital wallet.
"Facebook is once again pursuing digital currency plans on an aggressive timeline and has already launched a pilot for a payments infrastructure network, even though these plans are incompatible with the actual financial regulatory landscape," the senators wrote in a letter to Facebook Chief Executive Mark Zuckerberg.
"Facebook cannot be trusted to manage a payment system or digital currency when its existing ability to manage risks and keep consumers safe has proven wholly insufficient," the senators wrote.
The letter by the senators indicates that even Facebook's small pilot of its cryptocurrency wallet will face scrutiny from lawmakers and regulators, who have previously raised antitrust and other concerns.
A Novi spokesperson said: "We look forward to responding to the committee’s letter."
Facebook unveiled a cryptocurrency project in June 2019, as part of an effort to expand into e-commerce and global payments.
But the project immediately ran into fierce opposition from policymakers globally, who worried it could erode their control over the money system, enable crime and harm users' privacy.
In December, the project was rebranded in a renewed effort to gain regulatory approval, with its scope scaled back further to a single dollar-backed digital coin.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.