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Lawmakers Question Libra Amid Facebook Privacy Concerns

REUTERS/Dado Ruvic

Claire Smith Contributor

Lawmakers scheduled a hearing concerning Facebook’s newly launched cryptocurrency-based system, Libra, amid scrutiny over their instances of privacy invasion.

The Senate Banking Committee wrote an open letter to Mark Zuckerburg just over a month ago asking questions about the payment system’s consumer protections and legal compliance.

“What privacy and consumer protections would users have under the new payment system? How would this new cryptocurrency-based payment system work, and what outreach has there been to financial regulators to ensure it meets all legal and regulatory requirements?” the letter, signed by Chairman Mike Crapo and Ranking Member Sherrod Brown, asked.

North Carolina Republican Rep. Patrick McHenry sent another letter Tuesday to Maxine Waters, Chairwoman of the House Committee on Financial Services, in order “to request a hearing on Facebook and its recent announcement to create a new global cryptocurrency project.”

Waters also issued a statement arguing that “the cryptocurrency market currently lacks a clear regulatory framework to provide strong protection to investors, consumers and the economy.”

Waters asked Facebook to agree to a moratorium on Libra’s launch until Congress and regulators have the opportunity to examine it. (RELATED: FACEBOOK PARTNERS WITH MASTERCARD, VISA, UBER AND MORE IN PLAN TO CREATE FINANCIAL SYSTEM)

Lawmakers also expressed concerns about Libra on Twitter.

Sen. Brown tweeted promptly after the launch announcement that “Facebook is already too big and too powerful … We cannot allow Facebook to run a risky new cryptocurrency out of a Swiss bank account without oversight.”

Sen. Mark Warner tweeted that Facebook “was using its scale in social networking to achieve dominance in adjacent markets like mobile payments.” (RELATED: CONSERVATIVES REACT AFTER SEN. HAWLEY PROPOSES BILL CRACKING DOWN ON BIG TECH COMPANIES)

Lawmakers aren’t the only ones concerned about having Facebook in our wallets. Media analyst Mark Dice tweeted “So Facebook is launching their own cryptocurrency …Who the hell would trust Mark Zuckerburg with their money? …”

The Senate Banking Committee will hold a hearing, “Examining Facebook’s Proposed Digital Currency and Data Privacy Considerations” on July 16. Witnesses have not yet been announced.