US lawmakers urged to immediately stop the implementation of the Libra cryptocurrency Facebook project.
Democrats from the Financial Services Committee of the House of Representatives wrote a letter to Facebook director, Mark Zuckerberg, and other executives, expressing their concern about the risks Libra and its Calibra digital wallet might present to the current financial system.
The group requested to postpone the development of Libra and Calibra, which should be launched next year, until the regulatory authorities can fully investigate the risks involved.
“If such products and services like these, which remain improperly regulated and without sufficient supervision, they can pose systemic risks that threaten the stability of the financial system both in the US and in the world,” writes committee chairman Maxine Waters.
“These vulnerabilities can be exploited and hidden by bad players, like other cryptocurrencies, exchanges and wallets.”
The letter further states that investors and consumers operating in Libra may be exposed to “serious privacy and security concerns, cybersecurity risks and trade risks”, while those using Calibra may become “unique targets for hackers.
A group of lawmakers has previously hinted that it will require an investigation of the new Facebook cryptocurrency, which is supported by 27 other companies, including PayPal, Mastercard and Visa.
Facebook claims that one of the reasons why it announced Libra so much in advance of its official launch was to solve any problems that arose.
“We look forward to answering questions from politicians as this process progresses,” said a spokesman for The Independent.
Once launched, Libra will allow users of Facebook applications, such as Messenger and WhatsApp, to spend and receive digital tokens.
The technology giant claims that with more than 2 billion users worldwide, Libra and Calibra will offer vital financial services to those who are currently not served by traditional banks and financial organizations.
However, in addition to the concerns of Democrats of the House of Representatives, other officials also expressed concern about how this will be used.
Last month, French Finance Minister Bruno Le Mayr said that Libra should strictly abide by the rules in order to prevent its use as a tool for money laundering and terrorist financing.
Monsieur Le Maire told Radio Europe 1 that “there can be no question” of allowing Libra to become a sovereign currency. “This cannot and should not happen,” he said.
Others, such as cryptocurrency expert Phil Chen, warn that Libra can be used to further expand Facebook’s access to people’s personal data.