While it seems U.S. President Donald Trump and the Federal Reserve are at odds when it comes to interest rate policy, it appears they are in agreement when it comes to cryptocurrencies. Fed chairman Jerome Powell said after his testimony to Congress recently that crptocurrencies, Facebook’s Libra project in particular, is a cause for concern.
“Libra raises serious concerns regarding privacy, money laundering, consumer protection, financial stability,” Powell said at a congressional committee Wednesday. “These are concerns that should be thoroughly and publicly addressed.”
In similar fashion, President Trump took to Twitter to express his distaste for cryptocurrencies.
I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air. Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity….
— Donald J. Trump (@realDonaldTrump) July 12, 2019
The latest comments by the president and Fed chair come after French Finance Minister Bruno Le Maire said during a radio interview that Facebook’s latest foray into digital currencies “must not happen.”
Le Maire further said it was “out of the question” that Facebook’s cryptocurrency would eventually become a “sovereign currency.” The Group of Seven (G-7) collective that includes France, the U.K. and U.S. is looking to set up a forum that will delve deeper into the risks of digital currencies and their impact on the current financial system under fiat currency.
Cryptocurrencies are riding the wave of positive news stemming from social media giant Facebook unveiling its cryptocurrency payment plan on Tuesday. Dubbed “Project Libra,” the digital currency will feature partnerships with Visa and Mastercard.
The Facebook cryptocurrency news is setting the space abuzz with optimism as Bitcoin reached a high of $20,000 near the end of 2017 and fell over 70 percent since, but is climbing back to prominence again following this news. Despite pressure from governmental regulators for privacy issues, analysts are expecting this cryptocurrency offering will bolster Facebook’s profile.
A year ago, the plan for Facebook to roll out its own form of cryptocurrency was set in motion when the company appointed former PayPal executive David Marcus to begin exploring the opportunity. Since then, rumors swirled that Facebook was developing its own digital currency that would allow its users to store, trade, and exchange for regular currency via apps like Messenger and WhatsApp.
Facebook CEO Mark Zuckerberg was already hinting that new ventures like cryptocurrency would help diversify the company’s revenue streams, which relies heavily on advertising.
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