Facebook today announced plans to roll out a new form of cryptocurrency called Libra, which will integrate with the social media giant's apps including WhatsApp and Messenger in an effort to make moving money as simple as sending a text message.
Libra is actually the brainchild of a non-profit association by the same name made up of 28 different organizations around the world. Onboard are financial heavyweights like Mastercard, PayPal and Visa, along with notable names like Spotify, eBay and Uber.
That means that Facebook alone won't govern how Libra operates, but will do so in equal measure with all 28 members making up the Libra Association, which will be based in Switzerland. It says that bringing together partners from different industries and locations is a key in the mission to offer a decentralized digital currency, as will be the Libra Blockchain technology that serves as the framework for the ecosystem.
Alongside Libra, Facebook has also launched a new service called Calibra, which will start out as a digital wallet for storing, sending and receiving currency "at low to no cost," according to CEO Mark Zuckerberg. He hopes that with time the functionality of Calibra will expand to allow users to do things like more seamlessly pay bills or for coffee.
Perhaps unsurprisingly, lawmakers around the world have been quick to express concern over Facebook's plans in the finance space, particularly in light of recent issues surrounding user privacy.
"This transaction instrument will allow Facebook to again accumulate millions of millions of items of data," French Finance Minister Bruno Le Maire told Europe 1 radio. "This reinforces my conviction on the need to regulate digital giants and ensure they are not in a monopolistic situation."
Others were more forthright, including Democrat and US senator Sherrod Brown.
"Facebook is already too big and too powerful, and it has used that power to exploit users' data without protecting their privacy," he wrote on Twitter. "We cannot allow Facebook to run a risky new cryptocurrency out of a Swiss bank account without oversight."
While some have gone further and called for Facebook to hit pause on its crypto plans immediately.
"Given the company's troubled past, I am requesting that Facebook agree to a moratorium on any movement forward on developing a cryptocurrency until Congress and regulators have the opportunity to examine these issues and take action," says US Democratic congresswoman Maxine Waters. "Facebook executives should also come before the Committee to provide testimony on these issues."
Zuckerberg says Libra plans to launch in 2020.
Source: Libra Association (PDF)
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