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Zuckerberg to tell Congress that “Libra will Fix ailing Financial System”

Facebook CEO Mark Zuckerberg will tell congress that Libra can bring financial services to the world’s 1.7 Billion unbanked people. Facebook’s CEO released a written testimony a day before his scheduled appearance before the U.S House of Representatives Financial Services Committee. The Facebook CEO stated that Libra is envisioned as a global payments service that can make it easier to send and receive payments.

 “The current system is failing them,” Zuckerberg said. “The financial industry is stagnant and there is no digital financial architecture to support the innovation we need. I believe this problem can be solved, and Libra can help.”

He went on to remark about Facebook’s role in the Libra project and the backlash the company has faced.

“I believe this is something that needs to get built, but I understand we’re not the ideal messenger right now. We’ve faced a lot of issues over the past few years, and I’m sure people wish it was anyone but Facebook putting this idea forward.”

Looming Chinese threat

Mark Zuckerberg cautioned that if Libra does not actualize this idea, Chinese players will be waiting to pounce. He highlighted that the U.S might lose its “financial leadership” on the world stage if Libra is not allowed to launch. He noted that “China is moving quickly to launch similar ideas in the coming months.” He was also clear that Facebook will not be part of the Libra launch anywhere in the world until all “US regulators” give their approval to the project.  

Zuckerberg stated that Facebook does not “expect to be leading” any efforts in the development of Libra. Those efforts will be the preserve of the Libra association, which is the projects governing council. The council currently has 21 members which include Calibra (a Facebook subsidiary), and Breakthrough initiatives (a venture capital fund that Zuckerberg is involved in)

Libra not an alternative currency

Zuckerberg added that Libra had no intention of competing with sovereign currencies or meddling with monetary policy. He wrote that the “The Libra Association will work with the Federal Reserve and other central banks responsible for monetary policy to make sure that is the case.” He even expects regulators to keep Libra out of monetary policy.

“We expect the regulatory framework for the Libra Association will ensure that the Association cannot interfere with monetary policy. Libra is also being designed with economic security and stability in mind, and it will be fully backed through the Libra Reserve.”

Libra can reduce financial crimes

The Facebook CEO went to sell Libra as a potential hack against many financial crimes. He pointed out that with Libra; law enforcement could easily check on-chain activity and look at know-your-customer information to identify financial criminals.

image courtesy of CNBC.com

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