A bipartisan coalition of U.S. lawmakers has requested Facebook CEO Mark Zuckerberg to end his company’s crypto wallet pilot program and promise to not bringing the cryptocurrency Diem to market. “Facebook cannot be trusted to manage a payment system or digital currency when its existing ability to manage risks and keep consumers safe has proven insufficient,” the legislators added.
Senators Brian Schatz, Sherrod Brown, Richard Blumenthal, Elizabeth Warren, and Tina Smith addressed a letter to Mark Zuckerberg on Tuesday, following the social network giant’s introduction of a pilot for its crypto wallet Novi.
For the pilot, the giant social media platform has picked the Nasdaq-listed cryptocurrency exchange Coinbase as its custody partner. “Novi users who can participate in the pilot can acquire pax dollar (USDP) through their Novi account, which Novi will deposit with Coinbase Custody.” Novi users will then be able to instantly trade USDP amongst each other,” Coinbase stated.
The senators wrote, citing multiple Facebook scandals:
Given the scope of the scandals surrounding your company, we write to voice our strongest opposition to Facebook’s revived efforts to launch a cryptocurrency and digital wallet, now branded ‘Diem’ and ‘Novi,’ respectively.
According to the letter, Facebook has stated on several times that it would not create a digital currency without the consent of federal financial regulators.
The lawmakers noted that “Despite these assurances, Facebook is once again pursuing digital currency plans on an aggressive timeline and has already launched a pilot for payments infrastructure network, even though these plans are incompatible with the actual financial regulatory landscape — not only for Diem specifically, but also for stablecoins in general.”
The letter also mentions that “In addition to the risks products like Diem pose to financial stability, you have not offered a satisfactory explanation for how Diem will prevent illicit financial flows and other criminal activity.”
The senators went on to say:
Facebook cannot be trusted to manage a payment system or digital currency when its existing ability to manage risks and keep consumers safe has proven wholly insufficient.