Libra Hearing Fails to Assuage Senior Lawmakers' Concerns

Following testimony before the United States House of Representatives Financial Services Committee earlier today, lawmakers are still concerned about the possible launch of the Libra stablecoin.

On Oct. 23, legislators heard statements from Facebook CEO Mark Zuckerberg and posed questions covering a variety of topics from Libra to Facebook's data policies and reaction to possible foreign influences on the platform.

"It is not as if I support it if it does this or if it does that, at this point, I am not a supporter of Libra. I don't know what it is. I don't think that it has been adequately explained. I don't think that he should be moving forward with this huge project, this big idea, with all these other concerns that have not really been resolved. So basically it was recapping that kind of conversation."Proponents say prohibition could stifle innovation.

A number of representatives on the Financial Services Committee stated that not acting fast on Libra could lead to the world being left behind and losing its spot as a global leader in finance and innovation.

Rep. Patrick McHenry began his comments by declaring, "Today is a trial on American innovation."

Specifically, the Facebook founder noted that China was working on a digital version of its national currency which, should it come to fruition before a dollar-backed project like Libra, could threaten the United States economic and geopolitical position, he claimed.

"The financial industry is stagnant. There is no digital financial architecture to support the innovation that we need. I don't know if Libra is going to work, but I believe in trying new things."

In her statements after the hearing, Waters noted that she supports innovation, but first needs to know what the project is and how it operates before the government gives the green light to an association that would manage a potentially staggering amount of wealth.

In a separate hearing yesterday, Secretary of the Treasury Steven Mnuchin stated that the Financial Stability Oversight Council, which operates under the Treasury's purview, has created a working group to monitor cryptocurrencies and Libra.

Mnuchin added that participant institutions in the Libra may be one avenue through which the FSOC regulates the project.