Facebook’s cryptocurrency plan has finally found a place where it isn’t controversial — because everybody in Washington seems to hate it.
Treasury Secretary Steven Mnuchin on Monday became the latest to blast “Libra,” the digital currency the social network proposed last month to simplify global monetary transactions.
“I’m not comfortable today [with Facebook launching a cryptocurrency],” Mnuchin said in a Monday press conference, saying Libra is a “national security issue” because it could be “misused by money launderers and terrorist financiers.”
“They and others have a lot of work to do,” Mnuchin said. “This is indeed a national security issue.”
Mnuchin’s comments come as Facebook prepares for a two-day grilling on Capitol Hill over Libra — and as Democratic leaders in the House circulate draft legislation that could impose fines of $1 million a day on tech companies that launch cryptocurrencies.
Called the “Keep Big Tech Out of Finance Act,” the bill is aimed at tech companies that generate global annual revenue of at least $25 billion — a swipe at Facebook, which generated $55.8 billion in revenue last year.
The fresh wave of fear has helped tank the price of bitcoin, which hit an 18-month high when Facebook unveiled Libra last month.
By late afternoon Monday, bitcoin traded at $10,934.80 — well above its low of $9,872.03 Sunday — but also well off its highs near $14,000 notched three weeks ago.
David Marcus, the tech executive spearheading Facebook’s Libra initiative, has signaled he’s hoping to make nice with lawmakers as he begins two days of testimony before Congress on Tuesday.
“I want to be clear: Facebook will not offer the Libra digital currency until we have fully addressed regulatory concerns and received appropriate approvals,” Marcus is expected to tell the Senate Banking Committee Tuesday, according to prepared remarks.
Federal Reserve Chair Jerome Powell last week also warned against a “sprint to implementation” for Facebook’s Libra project, saying the globe-spanning currency “raises serious concerns regarding privacy, money laundering, consumer protection, financial stability.”
Powell’s crypto-bashing marked a rare point of agreement between him and President Trump, who has repeatedly criticized the Fed chair for raising interest rates too aggressively last year.
“I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air,” Trump said in a series of tweets last week.
“Unregulated crypto-assets can facilitate unlawful behavior, including drug trade and other illegal activity,” the president said before taking aim at Libra.
“If Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks, both National and International,” he tweeted.