Facebook CEO Mark Zuckerberg said Wednesday that the Libra digital currency will not launch in the U.S. or anywhere in the world without approval from U.S. regulators.
“Even though the Libra association is independent and we don’t control it, I want to be clear,” Zuckerberg said in his opening statement before the House Financial Services Committee. “Facebook will not be a part of launching the Libra payment system anywhere in the world, even outside the U.S., until the U.S. regulators approve.”
Zuckerberg’s statement provides the clearest indication yet that the Libra digital currency project announced this year faces an uphill battle. The project quickly raised red flags for regulators around the world after its announcement.
Committee members peppered Zuckerberg with questions about Libra as well as Facebook’s motivations for helping found the organization behind the project. The questions touched on the dangers of digital currencies in relation to money laundering, child pornography, the drug trade, international sanctions and data privacy.
Some expressed concerns that Libra could do more harm than good.
“Mr. Zuckerberg, we don’t want to break the international monetary system,” Rep. Nydia Velázquez, D-N.Y., said.
Zuckerman also faced questions about the diversity of the people behind the project.
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Many committee members have already voiced concerns over Libra. David Marcus, who heads up Facebook’s role in Libra, was grilled by the committee in July.
Facebook announced the project in June along with a nonprofit group based in Geneva that would oversee its development. Initial plans were for the currency to be available in the first half of 2020.
The project included a coalition of 28 backers and was promoted as a way to bring banking to the millions of people who are underserved by the global financial system.
But the project has encountered skepticism in the business, technology and regulatory communities, and has lost some of its biggest partners, including eBay, MasterCard, Visa and PayPal.
The hearing offered a live version of what has become a common cause in Washington — sustained and aggressive questioning of Facebook. At one point, after some tough questions, Rep. Steve Stivers, an Ohio Republican, asked Zuckerberg: “How are you?”
“I’m OK,” Zuckerberg said, eliciting laughs from people at the hearing.
Its the second time Zuckerberg testified before Congress after appearing in April 2018 before the Senate Judiciary and Commerce Committees as well as the House Energy and Commerce Committees.
While the Wednesday hearing had less fanfare than last time, Zuckerberg testified before a full room, with seats filled for the first two hours of the hearing.
Facebook faces scrutiny and pressure from a variety of politicians and regulators. The federal government, as well as most states, is investigating the company for possible antitrust violations. Democratic presidential candidate Sen. Elizabeth Warren, D-Mass., has called for the company’s break up, and Rep. Alexandria Ocasio-Cortez, D-N.Y., solicited questions on Twitter before the hearing Wednesday.
Facebook and Zuckerberg have also been criticized for the recent decision to allow politicians to run ads on its platforms that contain false or misleading information. Former Vice President Joe Biden’s Democratic presidential campaign called on Facebook to take down ads from President Donald Trump’s campaign that it said contained false claims about Biden.
Many committee members pushed Zuckerberg on this decision including Rep. Rashida Tlaib, D-Mich., who said allowing false statements in political ads had to led to violent threats directed at her.
“This isn’t about helping the politicians,” Zuckerberg said. “This is about making sure that people can see for themselves what politicians are saying.”
“It is hate speech,” Tlaib responded. “It is hate, and it’s leading to violence and death threats in my office.”
This story is developing. Please check back for updates.