Facebook CEO Mark Zuckerberg to Testify Before Congress Over Libra Crypto

Analysis

Facebook CEO Mark Zuckerberg will defend the Libra cryptocurrency project before U.S. lawmakers later this month.

The House Financial Services Committee announced Wednesday that Zuckerberg will testify on Oct. 23 during a hearing titled “An Examination of Facebook and Its Impact on the Financial Services and Housing Sectors.” He will be the only witness.

While details were sparse, a press release noted that Committee Chairwoman Maxine Waters (D.-Calif.) has called for Facebook to halt development of Libra until the company clarified details around the project and confirmed it would not destabilize the global financial order.

“At [a previous] hearing Committee Members discussed a draft bill, the ‘Keep Big Tech Out of Finance Act,’” the release said Wednesday, adding:

“The draft legislation prohibits large platform utilities, like Facebook, from becoming chartered, licensed or registered as a U.S. financial institution (e.g. like taxpayer-backed banks, investment funds, and stock exchanges) or otherwise becoming affiliated with such financial institutions. The bill also prohibits large platform utilities from establishing, maintaining, or operating a digital asset that is intended to be widely used as medium of exchange, unit of account, store of value, or any other similar function as defined by the Federal Reserve.”

This month’s hearing will be the third held by Congress: the House Financial Services Committee and the Senate Banking Committee both discussed Libra in July 2019. Facebook blockchain lead David Marcus testified on the potential benefits of the project at the time.

During those hearings, lawmakers were openly skeptical about Facebook’s efforts, pointing to its past track record with data privacy and other issues as concerns.

The regulatory backlash around Libra has also concerned Facebook’s launch partners. PayPal, which Marcus previously led, pulled out of the 28-member governing association last week. Visa and Mastercard are also reportedly concerned about the possible impact of continuing with the project.

Senators Brian Schatz and Sherrod Brown, both members of the Banking Committee, went as far as to warn the CEOs of Visa, Mastercard and Stripe on Tuesday, writing that participating in Libra Association could open them up to further regulatory scrutiny.

Mark Zuckerberg image via Frederic Legrand – COMEO / Shutterstock

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