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Home / Business / US Senate Mulls Regulatory Implications of Facebook's Mysterious Crypto Project

US Senate Mulls Regulatory Implications of Facebook's Mysterious Crypto Project



Recently, a thrill of excitement spread throughout the cryptocurrency community after news broke on social media giant Facebook's foray into the crypto industry through a new project that could introduce the benefits of digital currencies to billions of platform users.

Although this was certainly a bullish sign that many analysts regard as a sign of common introduction to emerging technology, the US Senate is now involved in the project, and recently sends an open letter to the company that requires them to reveal significantly more information about the project, which is currently somewhat mysterious.

Facebook has to answer several questions about crypto project

In a letter from the US Senate Committee on Banking, Housing and Urban Development, the Committee requested that tech giant clarify details of the project, especially with regard to how the project may affect digital privacy to the users.

The letter, specifically addressed to Facebook's founder and CEO, Mark Zuckerberg, also raises the question of possibly being subject to Facebook for the Fair Credit Reporting Act, which, according to the Federal Trade Commission, ensures that:

"The banking system relies on fair and accurate credit reporting … "and that it uses an" elaborate mechanism [that] designed to examine and evaluate the creditworthiness, credit status, credit capacity, character and general reputation of consumers. "

On this note, one of The questions from the committee on Facebook have been in contact with financial regulators to ensure that their crypto-based framework meets "all legal and statutory requirements." Most importantly, this letter signals that the regulation is still an obstacle to the crypto jumping before it can incur general adoption, as large companies loke to adopt the technology will probably have to deal heavily government engagement and regulatory officials that can hamper the speed at which crypto-based framework conditions can be developed and released for public use.

Concerns about Facebook's privacy and size violations continue to grow

Another important part of the letter is about what protections Facebook will achieve that ensure the security of personal information that may be postponed due to the use of crypto-based payment system.

"What privacy and consumer protection will users have under the new payment system?" The committee asked.

Concerns about Facebook's ability to exploit personal information come as one of the company's co-founders, called Chris Hughes, asking for the company to be broken up, said in a recent New York Times section that:

"The company's failure ̵

1; sloppy privacy practices that dropped tens of millions of users then take to a political consulting firm in the lap, "referred to the Cambridge Analytica scandal.

Hughes further noted that "Mark's influence is staggering, far beyond that of anyone in the private sector or in government" and concluded that "it's time to break up Facebook."

As Facebook continues to grow and Ventures into relatively new technology, such as crypto, to increase its continuous growth, it is highly likely that calls to break up the technical giant will continue to overcome, and that the government will only watch for regulating nascent technologies.

  Featured image from Shutterstock. 

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