The European Union is investigating Libra over potentially anti-competitive behaviour by Facebook.
To be precise, this is being investigated by the European Commission’s antitrust authority, which fears that the proposed payment system could unfairly cut off competitors.
According to Bloomberg, the investigation began two months ago, a few weeks after the announcement of the stablecoin, and would only be in its initial phase, that of information gathering.
Antitrust officials say they are concerned that Libra could create “possible competition restrictions”, particularly with regard to the information that will be shared on consumer use.
Antitrust is focusing on the possible integration of Libra into existing Facebook Apps, such as WhatsApp and Messenger, and on the governance of the Libra Association.
EU data protection supervisors are also concerned about the way in which Libra will share the immense amount of sensitive data it will inevitably collect. The concern is that Facebook can use this information to combine it with the information already in its possession, amplifying concerns about user privacy.
In addition, Facebook, together with Google and Apple, is already under investigation, once again by EU antitrust, with respect to its current dominant position in the market and especially the fact that it could unjustly use its enormous power to place competing apps at a disadvantage or eliminate them from the market.
Privacy is perhaps one of the biggest problems that Libra will have to deal with, as already now Facebook holds a huge amount of data about its users.
When the stablecoin will be launched, there is a real risk that the information that can be collected, particularly regarding the spending habits of consumers, will become really excessive.
The reassurances given by David Marcus, the project’s director, are only words, without any concrete constraint with regard to data sharing that could sweep away any doubt.