U.S. legislators said Facebook Inc. cannot be trusted with cryptocurrency management, and they have urged the social network to end the restricted pilot of its cryptocurrency wallet Novi, which was unveiled Tuesday, as quickly as possible.
Democrats Sherrod Brown, Brian Schatz, Elizabeth Warren, Richard Blumenthal, and Tina Smith have all expressed their opposition to Facebook’s two-year-old attempt to establish a cryptocurrency and digital wallet, which has been in the works since 2013.
Senate Democratic Leader Chuck Schumer and Senate Minority Leader Chuck Schumer wrote in a letter to Facebook Chief Executive Mark Zuckerberg:
“In spite of the fact that these plans are incompatible with the existing financial regulatory landscape, Facebook is once again pursuing digital currency aspirations on a fast timeline and has already established a trial for a payments infrastructure network.”
Nobody trusts Facebook
In their letter, the senators stated that Facebook cannot be trusted to handle a payment system or digital currency because “its existing ability to manage risks and keep users secure has shown to be totally inadequate.”
The senators’ letter implies that even the social media giant’s limited pilot program for a cryptocurrency wallet would be scrutinized by lawmakers and regulators, who have already expressed antitrust and other concerns about the company’s practices.
“We are looking forward to responding to the committee’s letter,” a Novi representative said in an email.
No to Facebook crypto
In June 2019, Facebook announced the launch of a cryptocurrency project as part of an endeavor to grow into e-commerce and international payments.
However, the idea was met with significant criticism from officials around the world, who were concerned that it would erode governmental control over the money system, facilitate crime, and compromise users’ privacy.
A second drive for regulatory approval saw the project revived in December, and its scope was further limited to include only a single digital currency backed by dollars.
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