Zuckerberg "Second Palace" attends the hearing Libra can break through the blockade

Four months ago, Libra was born, and this Facebook-led project sparked the digital currency. Four months later, Libra is still far from the official launch, and Facebook CEO Mark Zuckerberg is still uneasy about the upcoming hearing. France and Germany have begun to boycott, and the United States is still swaying. Under the pressure of multinational regulators, Libra may not be far from being "in the dead."

Second time attending the hearing

 

Under the three reminders of Congress, Zuckerberg had to go into battle personally, facing the bombing of the members. On the 9th local time, Maxine Waters, chairman of the US House Financial Services Committee, announced that Zuckerberg will attend the 23rd hearing.

At the hearing entitled "Reviewing Facebook and Its Impact on the Financial Services and Housing Sector", Zuckerberg will be the only witness, and he will face cross-examination by many members of the House Committee. This is the first time Zuckerberg has testified in Congress about Libra-related issues in the cryptocurrency, but it is already the second time Zuckerberg has visited Washington. It is reported that the hearing will begin at 10:00 am on the 23rd, US time, at 10:00 pm on the 23rd Beijing time.

For questioning Zuckerberg, the House of Representatives has long been eager to wait. Previously, as the second person of Facebook, the company's chief operating officer Shirley Sandberg was invited to participate in the hearing, but afterwards there was news that if Zuckerberg did not participate, the hearing may not be as scheduled. Held. House of Representatives Sylvia Garcia admits that Zuckerberg’s answer to Libra’s question is crucial. “Obviously, this is his idea. This is his company. I think he will be the one who knows the answer. ".

Under the taint of the “data gate”, Congress did not trust Facebook. The last hearing for Libra project leader David Marcus was full of doubts. “Why is Facebook involved in money, is it ambition? Too big, "How does Libra conduct anti-money laundering, counter-terrorism financing, prevent illegal use of drug trafficking groups, etc., and safeguard national security…"

This time is no exception. Rep. Lance Gooden bluntly said: "After the last hearing, my colleagues and I raised more questions than we got." Obviously, the House of Representatives has been gearing up, and this time Zuckerberg has to face Yes, it will be a more difficult problem than the previous two hearings. “Congress will ensure that we know what Zuckerberg is doing and whether Libra protects our consumers and the economy in one way or another.” Garcia said, “If Libra can’t do this, we’ll do our best. Go and stop it."

Partner exit

 

In addition to the aggressiveness of the US Congress, Libra is also facing "anti-water" by partners in the near future. On the 4th, PayPal, one of the founding members of the Libra Association, issued a statement announcing the formal withdrawal of the project. In the statement, PayPal said, "The company decided to abandon further participation in the Facebook-initiated Libra project and will continue to focus on the company's existing mission and business focus. But it will still support Libra's vision and look forward to continuing the dialogue on how to cooperate in the future."

For Libra, this is definitely a big hit. After all, the project leader David Marcus came from PayPal. Libra officials quickly issued a number of statements saying they were aware of the challenges of “reconfiguring” the financial system, but said “we better know this lack of commitment now, not later.”

To make matters worse, there may be more than just PayPal. According to the Libra white paper, the Libra Association consists of 28 financial, e-commerce, digital currency and Internet companies, and PayPal, Visa and MasterCard are core members. According to the Wall Street Journal, before PayPal, Visa and MasterCard, two bank card clearing organizations, said they would reconsider whether to join Libra due to strong opposition from government officials.

Time and time again, members of the parliament have slammed one after another, even the US President Trump has repeatedly bombarded Libra. In this case, the regulatory authorities are extremely questioning, the PayPal’s retreat is Reasonable. According to Reuters, PayPal's withdrawal from Libra is mainly due to concerns that Facebook is not doing enough to eliminate the suspicion of Libra projects or being used for money laundering.

In addition to external distrust, Libra also cracked inside. On the 9th, new unfavorable rumors appeared. Reuters quoted people familiar with the matter as saying that Simon Morris, the product manager responsible for managing Libra, had left in August after joining Libra for five months. Regarding the authenticity of the news and the impact of PayPal's withdrawal on Libra, the Beijing Business Daily reporter contacted the Facebook Media Contact Center, but as of the press release, no specific response has been received.

Digital currency

 

"Everyone is wondering if Facebook can launch Libra on his own date," ColinFLEX CEO Mark Lamb said bluntly. According to the original plan, Libra will be officially launched in the first half of 2020.

Xiao Lei, a senior financial analyst, told the Beijing Business Daily that the possibility of libra exiting in the short term is still very small. The policy is the biggest obstacle. At present, more market demand is needed to fight against the policy and the game, libra Need to obtain the authorization of the United States, this kind of authorization is a relatively strong regulatory logic. Even if it passes, it will bring about the compression problem in the living space. Therefore, the challenge currently encountered is relatively large, but this is a beginning, the future. It will definitely be launched, but it can't be over-expected.

Although the high pressure is difficult to avoid, but the current regulatory blank space is superimposed on the vast market, it is not just Facebook, but the retail giant Wal-Mart also has this intention. In August of this year, documents published by the US Patent and Trademark Office showed that Wal-Mart applied for a patent entitled "Systems and Methods for Building Digital Money through Blockchain."

The combination of retail and payment, Wal-Mart's ambition is self-evident. In the document, Wal-Mart writes that “the digital currency protected by the blockchain” can eliminate the need for credit and debit cards, which can be used as pre-approved biometric credits, one for their own digital value bank. "credit card". However, in response to a question from Bloomberg, Wal-Mart said it would not immediately activate the patent.

Similar to Libra, Sebel, a senior policy analyst at Wal-Mart Investment Bank Cowen, points out that Libra and Wal-Mart's cryptocurrencies are different in size. Facebook's Libra has global intent, and Wal-Mart's cryptocurrency plan does not currently show this. Ambition. Wal-Mart's plan is certainly unlikely to be automatically approved by Congress because its cryptocurrency may be seen as a threat to small banks and credit unions.

Banks have long been eyeing digital currencies. In July this year, Goldman Sachs CEO David Solomon said in an interview that Goldman Sachs is studying the concept of tokens extensively and will definitely introduce digital currency in the future. But in April, David Solomon also told the House Financial Services Committee that Goldman Sachs would not open an institutional digital currency exchange.

Compared to the high pressure in the United States, Japan seems to be more open. According to the Japan Financial Services Authority, 100 large Japanese companies have filed applications for digital currency business last year. In February of this year, Japan’s four major banks jointly issued the digital currency J-Coin Pay. However, Japan is also increasingly strict in regulating digital currency. In August this year, the Financial Services Agency of Japan announced the theme document “Practice and Future Policy of Financial Administration to the Present”, indicating that it will strengthen the grasp and analysis of the market trend of digital cryptocurrency, and with relevant departments, independent monitoring agencies, and overseas authorities. Cooperate and implement safety supervision.

"We need to let Zuckerberg know without a doubt that Facebook is not an independent kingdom. He can't always do whatever he wants." As Garcia said, no matter who is involved in the new digital currency field, no one can do whatever they want. Supervision may be late, but it will never be absent.

Source: Beijing Business Daily

Reporter Tao Feng Tang Yi Tian