Facebook is not going to launch its digital coin Libra unless regulators are fully satisfied and all necessary approvals are in place.
Under Facebook subsidiary Calibra, the social networking giant has planned to introduce a digital wallet for Libra. The wallet will be available on Messenger, WhatsApp and as a standalone app and is expected to be launched in 2020.
According to David Marcus, Head of Calibra who is set to face Senate Banking Committee over Libra concerns on Tuesday, US and state regulators will be involved when it comes to regulating services that offer Libra, reports The Verge.
Facebook is treating Libra as a “payment tool, not an investment”.
States would monitor Calibra as a money transmitter, with the US Federal Trade Commission overseeing consumer protections, said Marcus.
“The Libra Association won’t keep personal data beyond basic transaction info and Facebook won’t share Calibra wallet info with the rest of the company,” Engadget quoted Marcus as saying.
US Federal Reserve Chair Jerome Powell has raised “serious concern” over Libra.
Testifying before the House Financial Services Committee last week, Powell raised serious objections on Facebook cryptocurrency slated to arrive in 2020.
“I just think it cannot go forward without there being broad satisfaction with the way the company has addressed money laundering and other issues,” Powell told the House Financial Services Committee.
“Libra raises many serious concerns regarding privacy, money laundering, consumer protection, and financial stability,” Powell added.
In a letter sent to Facebook executives, US lawmakers have officially asked the social networking giant to cease all development of its Libra cryptocurrency.
Facebook has reportedly reached a whopping $5 billion settlement with the US FTC in the Cambridge Analytica privacy violations.
The report of the $5 billion settlement, the largest ever by the FTC against a tech company over privacy issues after a $22.5 million settlement with Google in 2012.