In the early morning of July 18, Beijing time, today, the Financial Services Committee of the U.S. House of Representatives held a hearing on Facebook (201.8, - 2.04, - 1.00%) Libra and reported the concerns to David & middot, head of Facebook Libra project; Asked David Marcus. The day before yesterday, the US Senate banking, housing and Urban Affairs Committee had held its first hearing. This is also the second hearing facing Libra.
The expert group of members of the house of representatives at this hearing includes Gary Gensler, former CFTC chairman, meltem demirors, bitcoin expert, and others.
Patrick McHenry, vice chairman of the Financial Services Committee of the U.S. House of Representatives, delivered the opening speech of this hearing. He said: "Washington must avoid becoming a place that stifles innovation. We can't choose to ban it because we can't understand technological innovation for the time being. In fact, today is not Facebook. Change has come. Blockchain technology is real. Facebook's entry into this new world only confirms this fact. Nakamoto's bitcoin is an irresistible force. We should not stop this innovation, and the government can't stop this innovation. "
All concerns will be resolved before the Libra project can be promoted
At tonight's press conference, U.S. congressman nidia & middot; Nydia Velasquez said: 'this is not Silicon Valley. You can't solve problems while walking.' In addition, Velasquez, together with Maxine & middot, chairman of the Committee; Maxine Waters and another congressman, Caroline & middot; Carolyn Maloney asked Marcus if he could promise not to promote the Libra project until policymakers formulated appropriate regulations.
Marcus replied: 'before promoting Libra, we will wait for all appropriate regulatory approvals and all concerns to be resolved.'
Some members asked why Facebook wanted to be Libra? It must be out of interest. Marcus said that we are to solve the transfer problem. Facing the question of house members' whether individuals can join Libra Association ', Marcus said that' individuals cannot participate 'because there are a series of standards to be met. According to Marcus, joining Libra needs to meet Facebook standards and pay $10 million.
Congressman: the US dollar represents that we can affect the world economic order. How will Libra affect the US dollar?
Marcus: we don't want to compete with the dollar. We are having active talks with the Federal Reserve and other organizations to ensure that it will not affect the dollar
Q: 'how does Libra work with regulators? The committee doesn't know what role Facebook will play. " Marcus said that Libra understood the need for appropriate supervision, 'which is also the spirit of our white paper'. Marcus revealed that Libra is working with G7 and Switzerland to solve the problem of regulatory trust.
Libra will compete with WeChat and Alipay
Members of the Financial Services Committee of the US House of Representatives asked whether the third-party Libra wallet could be integrated into WhatsApp and Facebook messenger. Marcus did not respond positively to this question. According to the testimony of Marcus and the US Senate hearing yesterday, the third-party Libra wallet may not be integrated into WhatsApp and Facebook messenger.
Members of the house of Representatives Financial Services Committee asked, 'if you (Facebook) want to compete with Alipay and WeChat, why do you want to register in Switzerland? Why should it be linked to a basket of currencies? " Marcus acquiesced in the fact that Libra will compete with Alipay and WeChat, and stressed again that'Libra's registration in Geneva is not to escape us supervision.
Marcus said that Libra is not securities and ETFs. It may be a commodity, but we (Facebook) want it to be a payment tool. Libra will not compete with sovereign currencies. It is obviously more suitable for the central bank to exercise the responsibility of sovereign currencies.
On the question of whether Libra is willing to comply with the sanctions requirements of the U.S. Treasury Department and prevent the sanctions wallet, Marcus said, "no matter whether Libra will go online or not, there will be other networks."
Marcus said that for many countries, Libra will become a very high-quality digital currency. For the question of house member 'how Libra operates in countries / regions with currency control', Marcus said that different countries will have different methods.
House member Blaine asked what kind of financial or banking services Libra would develop into. Marcus said that when needed, Libra's encrypted wallet Calibra will cooperate with the bank, and it is too early to discuss this issue. Marcus also revealed that 'when someone tries to convert Libra into US dollars, there will be a small handling fee, which depends on the exchange.'
How does Libra make money
Some members said that you said earlier that we don't need to trust Facebook in launching Libra. I think on the contrary, Facebook absolutely wants to win our trust.
David Marcus responded quickly: I mean, this trust is not necessary to operate Libra.
Congressman: Facebook was fined $5 billion before. Has Facebook learned any lessons from it?
Marcus: we did make a mistake.
MP: you should know that it is not advisable to launch services without testing, and the same is true for Libra.
Marcus: Libra hasn't launched yet. We're still trying to solve all the problems & hellip; The whole process must be made public, which is why we publish the white paper.
Congressman: you claim that Libra association is a non-profit organization, but I still have questions: why does Facebook get involved in this field? I don't believe in the idea of no profit.
Marcus: Libra has invested in FB in two ways. First, merchants who accept digital currency payment will advertise in FB. Second, we will cooperate with banks and other financial institutions to provide low-cost services, but this should be many years later.
Libra will give priority to privacy and consumer protection
Marcus said that Facebook will take time to make Libra better. He hopes that Libra's discussion is the most extensive discussion on digital currency in history. " We are fully committed to working with regulators around the world. Libra will give priority to privacy and consumer protection. Libra will implement safeguards against money laundering and terrorist financing. "
In response to a question from the Financial Services Committee of the US House of Representatives, Marcus promised that when Libra went online, it would fully analyze and study its defects and possible problems, 'we will invest time in this.' Nikhilesh De, a reporter from coindesk, blockchain media, pointed out that Marcus's reply was very skillful -- he avoided a positive response and did not promise to stop developing Libra.