Picture: DADO RUVIC
Picture: DADO RUVIC

Washington — Republican and Democratic senators sharply questioned Facebook’s plan to create its own digital money, adding to a chorus of scepticism across Washington and underscoring the challenges the company faces in getting its crypto-currency off the ground.

Senator Sherrod Brown, the top Democrat on the Senate banking committee, compared Facebook to a toddler that plays with matches. Speaking at a Tuesday hearing examining Facebook’s proposed digital token, Brown said he was worried about the company moving into the space considering the “havoc” it has already wreaked on other industries.

“Their motto has been move fast and break things,” said Ohio’s Brown, a Democrat, in his opening statement. “They certainly have. We’d be crazy to let them experiment with peoples’ bank accounts.”

Senate banking committee chair Mike Crapo, an Idaho Republican, said Facebook’s ambitions show that Congress needs to give consumers “real control” over their data to prevent companies from misusing it. He also raised concerns over Facebook’s “massive reach and influence within society” and the vast amount of personal information that the company had access to.

David Marcus, Facebook’s top executive on the project, sought to assuage law makers by pledging to work with regulators to address their concerns. “Facebook will not offer the libra digital currency until we have fully addressed regulatory concerns and received appropriate approvals,” he said in his opening statement.

The senators’ ire isn’t as a surprise to the company, which has been reeling after a series of privacy breaches and questions about its role spreading fake news in the 2016 presidential campaign. Among the sceptics of its crypto-plans are President Donald Trump, his treasury chief Steven Mnuchin, Federal Reserve chair Jerome Powell and members of Congress from both parties.

Even as the rhetoric rises, Tuesday’s hearing is also focusing attention on how crypto-currencies should be overseen by the federal government. At least a half dozen agencies, including the Fed, the Securities and Exchange Commission (SEC) and parts of the US treasury, have some say in the matter but none has taken a lead role.

In response to a question from Crapo, Marcus said that he didn’t know which agency might oversee its Libra platform but pledged to work with whatever regulator might step up.

Brown continued to lay into Facebook after his opening statement, repeatedly citing how much power the social network wields with its roughly 2-billion users. He told Marcus that it’s “delusional” for Facebook to think consumers will trust it with their financial data after the company allowed Russian bots to influence the 2016 US presidential election, along with other scandals.

Bloomberg