WASHINGTON – Facebook’s chairman and CEO Mark Zuckerberg made a patriotic pitch for his company’s controversial Libra cryptocurrency project, saying in congressional testimony Wednesday that it would help extend the United States’ financial leadership.
But Zuckerberg also recognized his company’s credibility problems in recent years.
“I believe that this is something that needs to get built, but I get that I’m not the ideal messenger for this right now,” Zuckerberg told members of the US House of Representatives’ Financial Services Committee. “We’ve faced a lot of issues over the past few years. I’m sure there are a lot of people who wish it was anyone but Facebook who proposed this.”
Zuckerberg was referring to recent scandals that have included the harvesting of the personal Facebook data of tens of millions of people by British political consulting firm Cambridge Analytica, security breaches that allowed hackers to steal personal information from millions of accounts and the use of the social media platform by Russian actors and other foreigners in an attempt to interfere with the 2016 US elections.
The 35-year-old technology entrepreneur said Facebook’s objective with Libra is to put “power in people’s hands.”
“People pay far too high a cost – and have to wait far too long – to send money home to their families abroad. The current system is failing them,” he said.
But the massive potential of a cryptocurrency created by Facebook, a social networking service with 2.38 billion monthly active users worldwide, has sparked regulatory concerns both in the US and internationally.
Zuckerberg was harshly grilled on Wednesday by US lawmakers.
“Facebook’s internal motto was for a long time ‘move fast and break things.’ Mr. Zuckerberg, we do not want to break the international monetary system,” Rep. Nydia Velazquez, a New York Democrat, said Wednesday.
Amid the attacks the Facebook co-founder sought to appeal to his countrymen’s patriotism, saying he believed Libra would be a tool to “extend America’s financial leadership as well as our democratic values and oversight around the world.”
He also warned about the risk that China, a major economic and geopolitical adversary of the US, could take the lead in the cryptocurrency race.
“While we debate these issues, the rest of the world isn’t waiting. China is moving quickly to launch similar ideas in the coming months,” Zuckerberg said.
In June, Facebook and more than a score of other companies (including Uber, Lyft, Vodafone and Spotify) that make up the Libra Association – a Geneva-based organization established to oversee this cryptocurrency – officially announced a 2020 launch date.
Facebook also has unveiled a new subsidiary, Calibra, that will build a digital wallet to enable people to store and exchange the currency via the Facebook apps Messenger and WhatsApp.
But intense regulatory scrutiny and public mistrust already have led some of the initial partners to quit the project.
Online payment systems operator PayPal announced on Oct. 4 that is was abandoning its plans to form part of the initiative.
A week later, five companies that had signed non-binding letters of intent to join the association – EBay, Stripe, Mastercard, Visa and MercadoPago – all followed PayPal out the door.
Zuckerberg, for his part, said on Wednesday that Facebook could be forced to leave the association if US regulatory approval is not secured and the company’s partners in the Libra Association want to move forward with the project.