Facebook’s digital coin ‘serious concern’: US Fed Chair

US Federal Reserve Chair Jerome Powell has raised “serious concern” over Facebook’s upcoming digital coin ‘Libra’.

Testifying before the House Financial Services Committee, Powell raised serious objections on Facebook cryptocurrency slated to arrive in 2020, the Wired reported on Wednesday.

“I just think it cannot go forward without there being broad satisfaction with the way the company has addressed money laundering” and other issues, Powell told the House Financial Services Committee.

Under Facebook subsidiary Calibra, the social networking giant has planned to introduce a digital wallet for Libra. The wallet will be available on Messenger, WhatsApp and as a standalone app and is expected to be launched in 2020.

“Libra raises many serious concerns regarding privacy, money laundering, consumer protection and financial stability,” Powell said.

David Marcus, head of Calibra, tweeted: “Just caught up with comments from @federalreserve Chairman Powell at his @FSCDems Hearing, and I fully agree that legitimate concerns about @Libra_ should be addressed carefully and patiently, and that it shouldn’t be rushed. This is why we shared plans early.”

In a new letter sent to Facebook executives, US lawmakers have officially asked the social networking giant to cease all development of its Libra cryptocurrency.

Representative Maxine Waters, the chairwoman of the House Financial Services Committee, hinted at a move like this in June, shortly after the project was announced.

According to reports, Waters has repeatedly called on the social networking giant to pause development of Libra, though this is the first time she has done so as part of a formal letter to the company.

Facebook currently generates 99 per cent of its revenue from advertisements and digital currency would help it reach billions of users across products — aiming to create another stable revenue stream and make cryptocurrecny-based payments mainstream.