The United States Congress yesterday sent an official letter to Facebook Inc., demanding that the company stops the development of its planned Libra cryptocurrency and native wallet, Calibra.
In its letter, the Congress alleges that the products planned by Facebook would lend itself to an entirely new financial system based out of Switzerland, and intended to rival the U.S monetary policy and the dollar itself.
Congress also believes that launching the products would raise serious privacy, trading and national security, and monetary policy concerns for both investors, consumers, and the global community.
However, it appears the primary concern for the lawmaking body is the fact the Facebook provided only scant information regarding the project in the whitepaper which was released last month.
Alleging to this, the letter says that Facebook failed to clearly define the intent, roles, potential use, and security of the products in question.
Furthermore, the company's poor record in handling user data in the past poses a potential danger to the trillions of dollars they want to bring under their control without any Federal depository insurance cover for users who would widely be exposed to hack attacks targeting their Libra funds.
The Congress finally asked Facebook, and its partners to immediately cease implementation plans until regulators and Congress have an opportunity to examine the identified risks and take necessary action, adding that failure to do so could allow the birth of a new "Swiss-based financial system that is too big to fail."
Meanwhile, as Stmarket.co reported in the past, the Bank for International Settlement (BIS) raised similar concerns regarding Facebook's planned cryptocurrency, although the U.S based company spoke to the Federal Reserve Bank before unveiling the project last month.