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The head of the US central bank believes that Facebook should not be allowed to launch its Libra cryptocurrency until the company explains how it will handle a number of regulatory problems.
"I think this can not go ahead without much satisfaction as to how the company tackled money laundering," said Jerome Powell, chairman of the US Federal Reserve, on Wednesday. at a hearing before the House Financial Services Committee.
He added:
"Data protection, consumer privacy, all of this will have to be addressed very thoroughly in a deliberate process that will not be an expedited process for implementation."
According to Reuters, Powell added that Libya was raising "a lot of serious concerns" about financial stability and consumer protection. The Federal Reserve has apparently set up a task force to monitor the evolution of cryptocurrency and is also working with central banks in other countries.
The US Financial Stability Supervisory Board, a federal organization created in 2010 under the auspices of the US Treasury Department, will also look at the project.
Powell explained that some of the concerns around Libra stemmed from the size of Facebook, noting that she "has over two billion users".
"I want real answers"
Facebook has been under fire since the publication of its White Paper on Libraries, lawmakers, regulators and finance ministers around the world asking the company to suspend development until issues concerning project are answered.
David Marcus, head of Facebook's blockchain and director of Calibra, a subsidiary that will build a digital wallet for cryptocurrency, answered some of the questions asked by the Senate Committee on Banks and Banks.
Senator Sherrod Brown (D-OH), a senior member of the committee, was not impressed by Marcus' responses, who said in a statement:
"Facebook has not been able to provide answers about Libra. I want real answers at next week's hearing and I urge our financial observers to take a close look at Libra to ensure user protection. "
Marcus will testify before the Senate Banking Committee on July 16 and the House Financial Services Committee on July 17.
Image of Fed Chairman Jerome Powell via the House Financial Services / YouTube Committee
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