How the years of controversy over privacy have finally caught up with Facebook

. The birth of the company in a Harvard dormitory in 2004, have taken in recent months more concrete than ever. In May, European regulators imposed a new strict regulatory regime. Meanwhile, US authorities have begun to scrutinize Facebook as part of a multi-agency federal inquiry into the treatment of a recent scandal that has revealed the information of 87 million people.

Worried about rising user and revenue costs, played a key role in a major Wall Street liquidation on Wednesday night and Thursday morning, reducing Facebook's stock by 20 percent. The magnitude of the decline suggests that investors are reassessing the viability of Facebook's core business – collecting detailed data on users so that they can better target them with advertising – in a world where political pressure is increasing for stricter protections. "It's a wake-up call that the markets are delivering to Mark Zuckerberg," said Jeffrey Chester of the Center for Digital Democracy, a privacy advocate.

[Facebook shares down more than 18 percent following revenue forecast]

The impact of European rules, called GDPR for the general regulation on data protection, has led to a decline of 3 million users on this continent, revealed the officials of the European Union. Business at a win call Wednesday. Facebook said the changes would continue to hurt revenues as more people pulled out of ad targeting in the coming months. The company also said it would lose money because its advertising partners had also been affected by GDPR and because of other upcoming privacy changes.

But Facebook, like other technology companies, has rolled out user protections around the world. the consequences for the company are likely to be global. Chief Financial Officer David Wehner said Wednesday in a revenue call that Facebook's expectations regarding declining earnings growth are "a combination of how we approach privacy, GDPR and others."

Problems for the company were confined to privacy issues. Signs of unrest have been growing for nearly two years, following the 2016 presidential election, when chief executive Mark Zuckerberg dismissed the possibility that creepy broadcast of phony reports on the platform affected the vote. He called the notion "a pretty crazy idea" but later apologized for the comment.

[Facebook shares tank on slowing growth, wiping out billions in value]

What followed was an important public account, rare for high-flying technology companies. Facebook finally revealed an aggressive Russian manipulation on its platform and had to answer sharp questions about it on the Capitol. Then, reports in March detailed how the Cambridge Analytica policy consultation siphoned off Facebook user data for targeting the campaign. This sparked another round of questions about Capitol Hill, this time from Zuckerberg himself.

Facebook's stock price withstood these controversies – apart from a drop after the news of Cambridge Analytica – even though Zuckerberg warned and misinformation on the platform would entail costs for the company, such than hiring tens of thousands of new content reviewers. This triumphant three-year trend is abruptly reversed after Wednesday's earnings call, which seemed to crystallize several long-standing concerns.

"The impact of data privacy and the GDPR seems to have had more effect on their business said Christopher Rossbach, director of investments at J. Stern & Co. GDPR gave users the more detailed opinions on how their data were collected and used and required explicit approvals.

He and others also noted that other technology companies such as Google .Parent Parent, had managed the transition to GDPR more easily.Other experts have said that it was a combination of factors

"If Cambridge [Analytica] had never happened, I do not think the concerns would be as pronounced. Cambridge has raised a number of concerns about the trust of users, advertisers and regulators. This creates a darker picture, "said Daniel Ives, director of strategy and head of technology research at GBH Insights.

US surveys, first reported by the Washington Post this month, have Two main areas of investigation: The Federal Trade Commission is investigating whether Facebook has breached a 2011 consent decree with the agency that governs its privacy practices when it has shared data with Cambridge Analytica and other companies.And the Department of Justice and the Securities and Exchange Commission are examining whether Facebook's representations of its actions with respect to Cambridge Analytica were timely and accurate.

[Facebook’s disclosures under scrutiny as federal agencies join probe of tech giant’s role in sharing data with Cambridge Analytica]

Facebook stated that he was cooperating with these investigations.He portrayed Cambridge Analytica and the people working for the company as acting inappropriately in collecting data.

The wider political atmosphere surrounding the company is also clouded amidst these controversies, with Republicans and Democrats calling for new regulation. "It takes a while for opinions to begin to settle, and I think the cumulative effect of months of scandal has shown that it's not something that they're able to fix." significantly, "said Sarah Miller, spokesperson for Freedom From Facebook, a nonprofit coalition of progressive groups calling for the dissolution of Facebook

Analysts began Thursday to debate whether the fall of Facebook indicated the likelihood of a break in the long run, stagnation or simply was a stumble – and therefore an opportunity to buy a fundamentally strong stock before continuing to rise again.

BTIG's Richar d Greenfield has Called the decline of GDPR-related users a "one-off drop, not a headwind" suggesting that Wall Street was exaggerating.

"We were very stressed during Facebook's conference call in Q2 2018 and had We could feel the fear / panic in investors' voices after, "he writes. But as we ponder why we believe in Facebook, the fundamentals of our investment thesis are unchanged. […] Mobile is eating the world and Facebook is a vital resource to benefit from this change.

What remains unclear is whether the pressure for stricter privacy regulations has peaked, and the fate of Facebook – and many other high-tech companies – is probably the answer to this question

The market here Thursday at noon has lost about 18% on Facebook – a sharp decline from the last peaks but showing signs of stabilization

Hayley Tsukayama and Hamza Shaban have contributed to this story