While it still hasn’t been confirmed as the source, the U.S. House of Representatives apparently drafted a new law designed to keep a definite separation between the cryptocurrency and technology spaces. The House’s Financial Services Committee is reportedly behind an alleged bill, “Keep Big Tech out of Finance,” that has appeared online. The legislation is in apparent response to Facebook’s Libra project.
The bill was brought to the public’s eye by The Block, which asserts that it had received details from a credible source that it was, in fact, presented to the House Financial Services Committee staff. However, it has not been officially submitted for consideration as of this writing.
“Big Tech” is essentially defined as any large platform utility that earns global revenue of $25 billion or more each year, according to the document. The document also states, “A large platform utility may not establish, maintain, or operate a digital asset that is intended to be widely used as medium of exchange, unit of account, store of value, or any other similar function, as defined by the Board of Governors of the Federal Reserve System.”
Facebook’s Libra has come under fire from governments around the world and the U.S. has been particularly active in calling out the Big Tech company. Facebook will have to appear before the Senate Banking Committee Monday (July 15) to answer questions about the project, and then with the House Financial Services Committee on Tuesday, July 16. The bill, if valid, may be a preemptive strike against Facebook to prevent it from being able to legally offer Libra in the U.S.
Libra opponents are coming out of the woodwork across the globe. Even U.S. President Donald Trump has weighed in, stating on Twitter, “If Facebook and other companies want to become a bank, they must seek a new banking charter and become subject to all banking regulations, just like other banks, both national and international.”
That could have been a warning shot across the bow that Facebook needs to reconsider its actions before launching Libra. According to the draft bill, the absence of a banking charter could be costly. It asserts, “Any large platform utility or financial institution that violates subsection (a) or (b) shall be subject to a fine of not more than $1,000,000 per each day of such violation, in an action brought by the appropriate Federal financial regulator.”
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