Social media giant Facebook (FB) heads to Capitol Hill on Tuesday and will face lawmakers for two days of testimony. This time, not for its misinformation woes or data privacy concerns, but for its bold new cryptocurrency ambitions.
On Tuesday morning, David Marcus, head of Facebook’s Calibra project, will testify in front of the Senate Banking Committee. He is expected to defend Calibra and the planned digital currency Libra. In his prepared remarks, Marcus said, “We know we need to take the time to get this right. And I want to be clear: Facebook will not offer the Libra digital currency until we have fully addressed regulatory concerns and received appropriate approvals.”
Marcus’s testimony comes on the heels of a quickly growing list of cryptocurrency critics, which include policymakers, regulators and even the president.
President Donald Trump publicly attacked crypto and Facebook’s Libra in a series of tweets last week.
I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air. Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity....— Donald J. Trump (@realDonaldTrump) July 12, 2019
....Similarly, Facebook Libra’s “virtual currency” will have little standing or dependability. If Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks, both National...— Donald J. Trump (@realDonaldTrump) July 12, 2019
...and International. We have only one real currency in the USA, and it is stronger than ever, both dependable and reliable. It is by far the most dominant currency anywhere in the World, and it will always stay that way. It is called the United States Dollar!— Donald J. Trump (@realDonaldTrump) July 12, 2019
And on Monday afternoon, Treasury Secretary Steven Mnuchin held a press briefing, in which he discussed Facebook’s Libra. He called Facebook’s project a national security threat and said that he had many concerns. Mnuchin said that the potential for illegal activities is high and thus Facebook will have a long and tough road ahead before getting the green light from regulators.
Federal Reserve Chairman Jerome Powell also expressed concern over Facebook’s crypto project last week. Marcus addressed Powell’s concerns, “Chairman Powell has made clear that the process for reviewing Libra needs to be patient and thorough, rather than a sprint to implementation. We strongly agree. That was the spirit with which we published the white paper introducing the Libra project. The time between now and launch is designed to be an open process and subject to regulatory oversight and review.”
The hearing is scheduled to kick off at 10 a.m. ET.
Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter: @heidi_chung.
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