Mr. First invoked a lyric from Buffalo Springfield’s 1966 song “For What It’s Worth” to describe the situation: “There’s something happening here. What it is ain’t exactly clear.”
Can Libra survive?
President Trump. Treasury Secretary Steven Mnuchin. The Fed chair, Jay Powell. The International Monetary Fund’s chief economist, Gita Gopinath. The Securities and Exchange Commission. Central bankers from Britain, China, France, Singapore and beyond.
That’s just a handful of the influential critics of Facebook’s new cryptocurrency project, Libra. And joining them this past week were lawmakers, as David Marcus, who leads Facebook crypto initiative, sat through more than six hours of hearings before the Senate Banking and House Financial Services Committees.
Concerns were numerous. “Facebook’s plans raise serious privacy, trading and monetary policy concerns,” said Representative Maxine Waters of California, the House committee’s Democratic chairwoman. She added that Libra could “yield immense economic power that could destabilize government.”
But the common thread was a deep-seated mistrust of Facebook. Or, as Senator Sherrod Brown, Democrat of Ohio, put it:
“Like a toddler who has gotten his hands on a book of matches, Facebook has burned down the house over and over, and called every arson a learning experience. We would be crazy to give them a chance to experiment with people’s bank accounts, and to use powerful tools they don’t understand, like monetary policy.”
Ouch. Everyone loves a challenge, but this seems overwhelming.
Mr. Marcus said during the hearings that Facebook was “owning” its mistakes and “working to remedy them.” And he insisted that the company wouldn’t launch Libra until regulators’ concerns were addressed.
But what will that take? With so many critics, there’s a risk that Libra may require a fundamental redesign, said Jerry Brito, the executive director of Coin Center, a cryptocurrency advocacy group.
“I don’t know whether they will want to move ahead with something like that,” he said.