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Facebook can’t be trusted to manage payment system: US lawmaker

Taking a jibe at Facebook, a group of US Democrats has asked Facebook CEO Mark Zuckerberg to end his digital wallet cryptocurrency project. He added that social networks cannot be trusted to manage cryptocurrency.

In a letter, Senators Brian Schatz (D-Hawaii), Sherrod Brown (D-Ohio), Elizabeth Warren (D-Massachusetts) among others stated that Facebook is once again trying to meet digital currency plans in a fast-paced time. Used to be.

It has already launched a pilot for a payments infrastructure network, even though these plans are inconsistent with the actual financial regulatory landscape not only for Diem in particular, but also for stablecoins in general.

The letter comes after Facebook launched Novi, a new digital wallet, as part of a pilot program in the US Guatemala, reported The Verge.

In the letter, the senators said that Facebook cannot be trusted to manage a payment system or digital currency. The current ability to manage risks and keep consumers safe has proven to be completely inadequate.

He emphasized that we urge you to discontinue your Novi Pilot immediately and commit that you will not bring the Diem to market.

Facebook’s 20 affiliates formally joined its digital currency project called Libra during a meeting in Geneva in October 2019.

After facing intense criticism from lawmakers regulators, Facebook had to shelve the Libra digital currency project.

Later, the company rebranded the Libra currency as diam (day meaning day in Latin), which is yet to be issued.

In a statement, Novi’s spokesperson said on Tuesday, “We look forward to responding to the committee’s letter.”

Earlier, in a bid to win over regulators, Facebook said that its cryptocurrency would only offer stablecoins backed by one country’s currency, meaning that some of the coins offered would serve as equivalent denominations of a dollar or euro. will do.

However, several giants have pulled out of the Libra project due to privacy concerns, such as PayPal, Mastercard, Visa, Macardo Pago, eBay, Stripe Booking Holdings Vodafone, etc.

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