Facebook Cannot Be Trusted to Manage Cryptocurrency: US Lawmakers

A gaggle of US lawmakers stated Facebook can’t be trusted to handle cryptocurrency and urged the social media platform to discontinue instantly a small pilot of its cryptocurrency pockets named Novi, which was launched on Tuesday.

US 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 pockets.

“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 signifies that even Facebook’s small pilot of its cryptocurrency pockets will face scrutiny from lawmakers and regulators, who’ve beforehand raised antitrust and different issues.

A Novi spokesperson stated: “We look forward to responding to the committee’s letter.”

Facebook unveiled a cryptocurrency undertaking in June 2019, as a part of an effort to develop into e-commerce and international funds.

But the undertaking instantly bumped into fierce opposition from policymakers globally, who fearful it may erode their management over the cash system, allow crime, and hurt customers’ privateness.

In December, the undertaking was rebranded in a renewed effort to achieve regulatory approval, with its scope scaled again additional to a single dollar-backed digital coin.

© Thomson Reuters 2021