Trump Disapproves Of Facebook’s Cryptocurrency
Some time ago Facebook did a huge announcement — the digital giant is going to launch its own cryptocurrency named Libra together with a proposed digital wallet Calibra. But its ambitions were lessened by Trump’s recent statements about Libra. God, this man has something to say about everything.
“Facebook Libra’s ‘virtual currency’ will have little standing or dependability,” Trump tweeted not so long ago.
A bunch of tweets the President shared with the public clearly show how little he believes in anything different from a good old American dollar. He said that “not a fan of bitcoin and other cryptocurrencies,” at all. This digital stuff is “not money” and he doesn’t believe their value is stable and says it is “based on thin air” (to be honest, I agree with him on that. I still can’t wrap my mind around what makes the value of the cryptocurrencies).
Trump went as far as to warn that “unregulated crypto assets” can promote and encourage people to break the law, including drug trade and other illegal activity. Pff, as if now people don’t do it.
Trump stated that if companies like Facebook want to get into the banking business (and cryptocurrencies kinda fell under that definition I guess), they will have to look for a banking charter and become subject to standard banking regulations. No one is left unwatched!
Jokes aside, but many politicians seem to be really afraid of Facebook’s ambitions and have support from both parties against the company’s initiative.
A simple fact: the Democratic-led Congress just requested that Facebook suspend development of Libra and Calibra. They are absolutely not fond of this idea.
The one who leads the walk against Facebook is Rep. Maxine Waters (D-CA), chairwoman of the House Financial Services Committee. She threatened to protest against the blockchain strategy of Facebook as soon as it launches.
Earlier the Facebook executives received a letter where Waters together with other politicians indicated that the company’s intention to launch own cryptocurrency “raises serious privacy, trading, national security and monetary policy concerns for not only Facebook’s over 2 billion users, but also for investors, consumers and the broader global economy.”
The authors of the letter demanded from Facebook to agree to a moratorium on anything to do with Libra and Calibra.
“It appears these products may lend themselves to an entirely new global financial system that is based out of Switzerland and intended to rival U.S. monetary policy and the dollar,” they warned.
Although the politicians may seem to overreact to Facebook’s ambition, many analysts actually agree that the potential significance of Facebook’s move into cryptocurrency is way too big to overestimate.
RBC Capital Markets analysts wrote that this may prove to be one of the most important initiatives in the history of the company to unlock new engagement and revenue streams.
However, all the concerns, control over currency won’t be all to Facebook. The company executives are planning to hand it on to an independent association located in Switzerland. This association already works with such financial giants such as Visa, Mastercard, and PayPal, as well as Uber and other top companies.
The company claims that Calibra would not give up account information or financial details to Facebook despite the fact it is a Facebook subsidiary. And none third party would also not receive customer data without their consent. But who reads license agreement anyway, right?
Facebook also promises that Calibra account information won’t be used for ad targeting (probably because they already have way too much info to sell us all that junk).
The Senate Banking Committee is expected to hold a hearing on July 16 to review Facebook’s blockchain strategy.