Lawmakers Express Privacy Concerns About Facebook’s Libra
new cryptocurrency, Libra, lawmakers were uneasy about the company’s ambitions to reach into the financial lives of its users. The fears centered on privacy, given Facebook’s prior breaches of trust, and how the company would handle that financial data. On Tuesday, officials awoke to a far more daunting prospect: a rival to the global financial system, privately controlled by a consortium of powerful companies.
Gregory Barber covers cryptocurrency, blockchain, and artificial intelligence for WIRED.
The concerns run the gamut, suggesting the regulatory headaches ahead for Facebook as it tries to execute its Libra vision. Regulators in Europe are worried that Libra could become a systemic risk to the global financial system and rival central banks; a member of the US Congress called for Facebook to halt development until it answers questions about privacy; officials elsewhere have expressed fears that any cryptocurrency may help users evade global sanctions or launder money.
In Libra, regulators are grappling with something of a regulatory octopus, a single protocol with many tentacles. There’s the Geneva-based Libra Association, of which Facebook is just one member, along with companies like Uber, Spotify, PayPal, and Visa. The association will oversee the Libra currency, backed by real money, as well as the blockchain platform that allows Libra to be sent around the world. In theory, members will then build their own Libra products, each of which will need to conform to local rules where they operate. For Facebook, that’s in the hands of its new subsidiary, Calibra, which is building a wallet that will be integrated throughout its platforms, starting with Messenger and WhatsApp.
“The network will be available globally when it’s ready, and then it’s up to individual wallets to decide whether to go global or focus on specific countries,” David Marcus, head of Calibra, told WIRED last week. Facebook is now “in the process of obtaining the appropriate licenses … in order to operate in as many geographies as we possibly can.”
That won’t include India. Facebook’s largest market by users was reported last December to be a likely pilot locati
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