Mark Zuckerberg has indicated he is willing for Facebook to pull out of the libra digital currency if other founding members decide to press ahead without US approval.
The go-ahead from regulators across the Atlantic is one of the key provisions the social network has pledged in order to allay concerns about the cryptocurrency.
However, the US financial services committee appeared largely sceptical of most assurances, expressing fears that the system could be open to abuse by criminals and terrorists.
In his first testimony before congress since April 2018, Zuckerberg reiterated that Facebook would not be prepared to launch libra without permission from US regulators.
“The independent Libra Association is a separate thing that exists at this point and if I feel like Facebook can’t be a part of it in keeping with the principles that I’ve laid out, then Facebook won’t be a part of it,” he said.
“We might be required to pull out if the association independently decides to move forward on something that we’re not comfortable with, but my understanding right now is everyone is aligned on making sure that we have US regulatory approval to launch anywhere in the world and that’s the goal.”
The Facebook founder admitted that the “risky” nature of the project and intense scrutiny was probably the likely cause for early big-name backers including Visa and Mastercard leaving the Libra Association.
Independent body
Acting as an independent governing body for the currency, the Libra Association formally signed up 21 initial members earlier this month, seven firms less than originally announced.
Several representatives asked why the Libra Association is based in Switzerland instead of the US, to which Zuckerberg said Facebook does not have control over the consortium to determine its home.
The 35-year-old was also grilled about diversity, political advertising, deep fakes and fears about child sexual exploitation over plans to roll out end-to-end encryption across all of the tech giant’s platforms.
“I hope you have learnt today just how many concerns and questions members of congress and the public have, not just with the libra project, but Facebook’s diversity failures, including an abysmal record of hiring and promoting people of colour and women, contracting with diverse suppliers and investing in diverse asset managers, and it appears that the Libra Association’s board diversity numbers have followed Facebook’s example,” committee chairwoman Maxine Waters said in her closing remarks.
“Regarding the libra project, we heard concerns ranging from your failure to unequivocally prevent anonymous use, which means sex traffickers and child pornographers and other bad actors can finance their nefarious activities.
“We also heard repeatedly that this project poses a systemic threat to the US and global economy, and I hope that you have heard these concerns and that you will heed our warnings.”
