Facebook recently announced the launch of its new crypto wallet Novi, in partnership with Coinbase. Some US senators, however, did not like it and explicitly called for its immediate closure. All of this in a letter sent to the company’s CEO, Mark Zuckerberg, yesterday.
Summary
Facebook wallet shutdown: the reasons
The letter, signed by Brian Schatz, Sherrod Brown, Richard Blumenthal, Tina Smith and, above all, Elizabeth Warren, explicitly urges Zuckerberg to immediately stop the Novi pilot project, and even to commit not to bring the Diem stablecoin to the market.
This is an incredible initiative that reveals how there are still politicians who, unfortunately, despite living in a liberal country. And think they can impose their personal ideas on companies that should instead operate in a free market.
Senator Warren, in particular, has often been very critical of cryptocurrencies in the past, but has also repeatedly shown that she does not really understand what they are and how they really work.
US Senators’ letter to Facebook
The letter opens with a clear reference to the “scandals” involving Facebook over the years, claiming that Facebook has pursued profits at the expense of its users.
They cite issues that are totally irrelevant to cryptocurrencies and the Novi project, such as “algorithms that harm adolescents and teens, particularly girls”, or the indifference shown by the company to the damage its products would cause.
They cite the scale of these scandals as the reason for their strong opposition to the plan to launch a cryptocurrency and a digital wallet.
While this initiative of the five senators should not have any legal value. It probably has a strong propaganda value. Since Facebook can hardly be prevented from issuing a digital wallet, as other companies have not been prevented from doing so.
The people who signed the letter seem to have little or no understanding of how these new technologies work. Not least because the Novi wallet pilot project uses Pax Dollars (USDP), a stablecoin that already exists and is used by other wallets.
A few days ago, Coinbase’s CEO Brian Armstrong congratulated one of the main architects of the Diem project, David Marcus, calling those who oppose the project simply “haters”.
The senators who signed the letter actually sound more like haters than representatives of the people, the nation, and the Constitution.
They assert:
“Facebook cannot be trusted to manage a payment system or digital currency. When its existing ability to manage risks and keep consumers safe has proven wholly insufficient”.
Propaganda vs. reality
To date, there seems to have been no significant problems with the millions of transactions the company handles each year. For example with advertisers, so the company would actually appear to be quite trustworthy in this regard.
The problems highlighted by the senators concern aspects that have nothing to do with financial transactions. Are probably only used as a pretext for political propaganda in order to gain support, without the slightest real possibility of succeeding in imposing a stop to the Novi project.
