Facebook seems to be getting a lot of tough questions just weeks after it announced that it would be launching its own cryptocurrency, the Libra.
A report in The Guardian stated that the US Congress has asked Facebook to pause any proceedings with Libra as lawmakers wanted time to investigate the potential ramifications of launching the digital currency.
“Because Facebook is already in the hands of over a quarter of the world’s population, it is imperative that Facebook and its partners immediately cease implementation plans until regulators and Congress have an opportunity to examine these issues and take action,” said a letter by the Democratic heads of the house committee on financial services and its subcommittees to Facebook.
The letter also stated that a court would hold public hearings on the risks and benefits of cryptocurrency-based activities and explore legislative solutions.
Meanwhile, the UK’s Financial Conduct Authority (FCA) has proposed a ban on all derivatives of cryptocurrencies in a bid to protect small investors.
Interestingly, David Marcus, head of blockchain at Facebook had earlier written in a blogpost that the “great promise” of Libra was to help those who were poorly served by the current banking system, more specifically individuals from developing countries.
Libra has been facing a lot of questions from experts, some of whom ask why the currency was built in top secrecy when it would be ultimately handed over to a body of partners which would control its functions.
Some say that Facebook, instead of going to so much trouble in designing a new currency, could have easily created a system that utilises multiple existing payment methods and connect the same to Facebook products.