Key Takeaways From Facebook CEO Zuckerberg’s Planned Libra Testimony
For most of its nearly 11-year lifespan, Bitcoin has flown well under the radar of the U.S. government. But Libra’s launch has changed things.
With the launch of Facebook’s cryptocurrency project, which will be adopted by millions when it launches, global regulators have felt the need to respond. So much so that discussion regarding Libra is reaching the upper echelons of Washington.
Libra on the Hill… Again
As reported by Blockonomi previously, on October 23rd (today as of the time of me writing and publishing this), Mark Zuckerberg will be testifying on Libra at the day’s hearing of the House Financial Services Committee. He is testifying due to a request from Congresswoman Maxine Waters of California, who has been overtly skeptical of the project since its launch.
Zuckerberg is slated to be the sole witness at the aforementioned hearing, which has been entitled “An Examination of Facebook and Its Impact on the Financial Services and Housing Sectors.”
Zuckerberg’s forthcoming testification will satisfy the requests of members of the Committee, of which some urged the Facebook founder to appear in the House when David Marcus was grilled by the same committee in July. At the time, Brad Sherman, a Congressman from California, likened Libra’s potential damage to the lives of Americans to 9/11, before adding that it should be Zuckerberg himself addressing the House, not an executive.
So, this may leave you wondering — what is Zuckerberg going to say?
The world recently got an answer, with Facebook giving regulators the CEO’s planned testimony on Tuesday afternoon. Here are some key takeaways that Blockonomi and other members of this industry have found interesting.
NEW: Here's Mark Zuckerberg's planned testimony as he prepares to speak on Facebook Libra on the Hill tomorrow
Read it in full: https://t.co/eFyzoBjPI2
Plus, more background here: https://t.co/iqN6nTElDQ pic.twitter.com/QizHr0og9F
— Bloomberg Crypto (@crypto) October 22, 2019
What Will Zuckerberg Say?
First and foremost, Zuckerberg asserted that there is a need for new financial infrastructure, citing the simple fact that the exists “more than a billion people around the world who don’t have access to a bank account.”
He elaborated that being excluded from the financial system has “real consequences,” looking to the high cost and long wait times that are associated with cash remittances. As the Facebook chief put it simply, “the current system is failing the disadvantaged; the financial industry is stagnant.” This, he claims, is the problem that Libra is looking to tackle, or at least “help”, by putting “power in people’s hands.”:
“A simple, secure, and stable way to transfer money is empowering. Over the long term, if it means more people transact on our platforms, that would be good for our business. But even if it doesn’t, it could help people everywhere.”
Secondly, the Facebook chief largely sidestepped the fears of terrorism financing and criminal activity enabled by Libra, and instead focused on the idea that there are risks in not innovating.
By that, he was evidently discussing the discussion regarding stopping Libra from moving forward. He remarked that with China “moving quickly” to launch digital currencies “in the coming months,” the U.S. would be remiss in not innovating, or else will risk losing its “financial leadership.” Indeed, a world in which the U.S. doesn’t have its own digital currency system will likely see it lose traction to the nations that do.
Thirdly, Zuckerberg confirmed that Facebook, and Libra by extension, will (and does) not sell people’s data, does not use people’s data to make decisions about lending, or to create credit reports, or share information with third parties for lending/credit decisions.
And lastly, it was stated that Libra will not threaten or infringe on the existence of sovereign currencies and the central banks backing them. “We expect the regulatory framework for the Libra Association will ensure that the Association cannot interfere with monetary policy. Libra is also being designed with economic security and stability in mind, and it will be fully backed through the Libra Reserve,” Zuckerberg wrote.
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