Facebook on Tuesday introduced a comprehensive, borderless economic system for its platform, which is based on a new cryptocurrency, Libra.
The company plans to sit ostentatiously on its hands when it comes to governing the project, just one member of the so-called Libra Association, with a total of 28, to emphasize the separation between the currency—which will have a record of your every purchase—and the company, which has an oft-told history of privacy breaches and disregard for rules and regulations.
A new subsidiary, Calibra, will be Facebook’s way of accessing the currency, which itself will be run out of Switzerland.
US Representative Maxine Waters, chair of the House Financial Services Committee, spoke out immediately: “Given the company’s troubled past, I am requesting that Facebook agree to a moratorium on any movement forward on developing a cryptocurrency until Congress and regulators have the opportunity to examine these issues and take action.” Senator Sherrod Brown, a Democrat from Ohio, cautioned via Twitter: “Facebook is already too big and too powerful, and it has used that power to exploit users’ data without protecting their privacy.
We cannot allow Facebook to run a risky new cryptocurrency out of a Swiss bank account without oversight.”
Noam Cohen is a journalist and author of The Know-It-Alls: The Rise of Silicon Valley as a Political Powerhouse and Social Wrecking Ball, which uses the history of computer science and Stanford University to understand the libertarian ideas promoted by tech leaders.