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House lawmakers officially ask Facebook to put Libra cryptocurrency project on hold

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‘These vulnerabilities could be exploited and obscured by bad actors’

Illustration by William Joel / The Verge

House Democrats are requesting Facebook halt development of its proposed cryptocurrency project Libra, as well as its digital wallet Calibra, until Congress and regulators have time to investigate the possible risks it poses to the global financial system.

Rep. Maxine Waters (D-CA), the chairwoman of the House Financial Services Committee, hinted at a move like this last month shortly after the project was announced. Waters’s letter today, sent to Facebook’s CEO Mark Zuckerberg, Chief Operating Officer Sheryl Sandberg, and Calibra CEO David Marcus, formalizes that request from a few weeks ago. Aside from Waters, the letter is signed by House Finance’s subcommittee leaders.

“If products and services like these are left improperly regulated and without sufficient oversight, they could pose systemic risks that endanger U.S. and global financial stability,” Water writes. “These vulnerabilities could be exploited and obscured by bad actors, as other cryptocurrencies, exchanges, and wallets have been in the past.”

Skepticism of the project isn’t only couched in the Democrat-controlled House, either. Senate Banking Chair Mike Crapo (R-ID) scheduled a hearing with Marcus for July 16th, citing concerns over the currency and the potential risks for data privacy it poses. The following day, Waters’s committee will also hold a hearing on the project.

“We look forward to working with lawmakers as this process moves forward, including answering their questions at the upcoming House Financial Services Committee hearing,” a Facebook spokesperson told The Verge Tuesday.

“Because Facebook is already in the hands of over a quarter of the world’s population, it is imperative that Facebook and its partners immediately cease implementation plans until regulators and Congress have an opportunity to examine these risks and take action,” the letter says.

Updated 7/2/2019 at 7:22 p.m. EST: Updated to include statement from Facebook.