Facebook won’t launch cryptocurrency until U.S. regulators approve
In a prepared statement to a House oversight committee, Facebook CEO Mark Zuckerberg said plans to launch a global payments system will remain on hold until U.S. regulators approve it. The comments end speculation Libra coin could go live in nations where there is no government pushback.
The statement, published today, will be part of Zuckerberg’s planned testimony before the House Committee on Financial Services on Wednesday. The committee announced in August it would continue reviewing Libra and hear testimony not only from Zuckerberg but also government officials and regulators.
In June, Financial Services Committee Chair Maxine Waters asked Facebook in a letter to pump the breaks on its Libra launch, “given the company’s troubled past,” until officials can examine issues associated with it more closely “and take action.”
Libra cryptocurrency and its Calibra online wallet had been scheduled to launch in 2020, but U.S. regulators argued too little was known about the digital money and its potential to enable money laundering, adhere to know-your-customer rules, and could threaten user privacy. French and German regulators also said they would not allow Libra to launch within their borders because it could threaten the Euro’s value and unlawfully privatize money.
It’s not the first time cryptocurrency has been challenged by governments around the globe. Last year, the Reserve Bank of India (RBI), the country’s central bank, announced a ban on the use of Bitcoin and other digital money by any regulated financial entity because of risks associated with it. China has also banned the use of some cryptocurrencies, while also planning a launch of its own digital money.
In his statement, Zuckerberg warned of the risks of not innovating on financial infrastructure, which he called “stagnant.”
“While we debate these issues, the rest of the world isn’t waiting. China is moving quickly to launch similar ideas in the coming months,” Zuckerberg said in the prepared remarks. “Libra will be…