CRYPTO MOVERS AND PRICES
CRYPTO STORY OF THE DAY
It Is Official, Mark Zuckerberg Will Once Again Be On 'The Hill' Later In October To Defend Facebook's Libra Project - This Comes As Draft Legislation Is Tabled That Hopes To Ban Technology Companies From Operating Anything That Could Be Viewed As Currency - The Situation Around Libra Appears To Be Bordering On Desperate
Over the last weeks, Facebook and Libra, together and individually have seen a slew of issues. On the Libra front, prior Calibra commits continue to express unease in the press with PayPal the most recent to pull-out of the project altogether. This of course in response to the aggressive regulatory tone taken up by lawmakers from the US, to Europe, to Asia. Zuckerberg's decision to testify comes as House Financial Services Committees Chair Maxine Waters has apparently drafted potential legislation titled, 'Keep Big Tech Out Of Finance.' On the Facebook-proper side of the equation, the company is facing developments far more potentially impactful to its current business. FB is currently in late stages in European courts over whether they breached EU privacy laws. A negative ruling could see the company owe as much as 4% of global revenues. Furthermore, in what is being described as a direct attack on Big Tech, the OECD has proposed new rules on global taxation that would eliminate tax optimization strategies apparently widely used among the FAANG group of companies.
Crypto Takeaway: When Libra was first announced we saw a slew of issues with the project. We felt as though there was little available in preliminary docs in describing how the proposed system would function and we disagreed with some of the economic philosophies proposed by the papers. What we found the most confusing, however, was why Facebook decided to wrap what was clearly a payment network in this (crypto) currency wrapper. This would surely disturb governments who were already placing the firm under intense scrutiny for the highly publicized privacy breaches. We believe that view has been vindicated and that a move, such as Zuckerberg testifying in Congress again, was never part of the anticipated path for Libra. The likelihood Libra ever sees the light of day is becoming more of a 50/50 proposition.