According to reports, antitrust regulators at the European Commission have launched an investigation into Facebook’s ‘cryptocurrency’, Libra. The EU has previously expressed concerns that Libra would monopolize payments and unfairly shut out competition.
Colleagues at Bloomberg claim to have seen a document that confirms EU antitrust regulators have already begun “investigating potential anti-competitive behavior”. The main concern appears to be the potential to create competition restrictions concerning the information that will be exchanged with Libra and the use of consumer data.
The investigation, which is reported to still be an early-stage inquiry at the time of writing, follows a questionnaire sent out by EU officials last month which revealed concerns about the potential for a Facebook-run monopoly of the proposed payment system.
Libra, revealed for the first time earlier this year, has some big-name backers including MasterCard, PayPal, Visa, eBay, Spotify, and Uber. Mark Zuckerberg’s team call it a cryptocurrency, but it’s not quite the same as Bitcoin or other popular blockchain products.
The Libra Association, an independent, not-for-profit membership organization put together to oversee the new digital currency from Facebook, is based in Geneva, Switzerland. According to Reuters, the Federal Data Protection and Information Commissioner (FDPIC), Switzerland‘s privacy regulator, is expecting more details on Libra by the end of the month.
It’s not just in Europe that Libra is attracting the attention of regulators, either. The US Treasury has also expressed concerns regarding how the digital currency has the potential to be used for money laundering and funding terrorism. Facebook has promised not to go live with Libra until the authorities are satisfied.
It will be years before you can use Libra to pay for anything
Let’s just say that eyebrows were raised when we first heard about Libra in the AP office, as I’m sure was the case for many worldwide. The problem here is that Zuckerberg and his gang of all-conquering data harvesting buddies have not really recovered from the Cambridge Analytica scandal in terms of public trust, at least with those who care about things like privacy and data protection.
I think that Facebook has a long, long way to go before it can convince regulators in both the US and Europe to give Libra the green light. The EU Commission, in particular, is not going to just let this one quietly slip through. Brussels has already slapped both Google and Apple with record-breaking fines, and has shown little fear of the big tech giants who’d rather play by their own rules.
Cryptocurrency, in general, is also under some scrutiny by authorities worldwide for the same reasons the US Treasury is concerned about Libra. When you throw data protection into the mix, a Facebook ‘crypto’ payment system is like a cocktail of all of the nasty things we find in the shady back alleys of the internet.
When do you think you’ll be able to pay with Libra? Never? Let us know.