David Marcus was a cool and composed customer yesterday on the first day of US Congressional hearings concerning Libra, Facebook’s digital currency. Lawmakers quizzed the head of Calibra, the Libra wallet, primarily on the issues of privacy and trust.
Senator Jon Tester asked about Libra’s ability to make assurances against fraudulent purchases or loss of funds, along the line of credit cards. Marcus responded, “We will do our best to resolve those types of issues and claims as quickly as possible.”
Senator Sherrod Brown of Ohio took a more critical stance towards the project, asking “do you really think people should trust Facebook with their hard-earned money?” To this Marcus replied, “Facebook will have no special privilege.” There were a few raised eyebrows at this. Brown also wanted to know if elected leaders could say anything that might stop Facebook launching Libra. Marcus’s response to this was interesting. He said “If our country fails to act, we could soon see a digital currency controlled by others whose values differ radically from ours.”
When Elizabeth Warren got hold of the microphone, she was keen to find out more about data portability. “If a Facebook user wishes to use a wallet other than Calibra, will you make it easy to allow the export of other data?” she asked. Marcus said “Absolutely,”, but unfortunately couldn’t give her a clear answer about that in respect of Messenger and Whatsapp. Warren came back at him with, “what Facebook’s been really good at is figuring out how to monetize people’s personal data […] I am not reassured by your statement that you can not see any reason right now why there would not be any data sharing between these platforms.” Ouch!
Today, Marcus will face the U.S. House Financial Services Committee and its formidable chairwoman Maxine Waters, She is no fan of the project and has already said regulators should view Facebook’s plans for Libra “as a wake-up call to get serious about the privacy and national security concerns, cybersecurity risks, and trading risks that are posed by cryptocurrencies.”
According to CCN the House Financial Services Committee has drafted a Libra killer bill that bans big tech companies from launching cryptos. It’s called the “Keep Big Tech Out of Finance Act.” But it may not have enough teeth to do that.
By the end of today, we should have a clearer picture about where this is all going, and who the clowns are.