Blockchain Advocates Push Back Against Trump's Crypto and Libra Tweets

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July 12, 2019

Amid a resignation from his labor secretary, an ongoing crisis over the treatment of families at the border, and a controversial social media summit lacking any mainstream tech platform, President Donald Trump Thursday evening decided to share his feelings on cryptocurrencies and Facebook's plans for Libra currency.

"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," the president tweeted. "Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity."

He then specifically called out Facebook's Libra Project, saying the currency will have "little standing or dependability."

"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," the president added on Twitter.

The comments come just a week before a hearing where Facebook's David Marcus is expected to testify on the company's plans for a virtual currency called Libra.

Advocates for blockchain-based currencies were quick to criticize the president over his tweets.

"President Trump is stuck in the past and afraid of the future. I suspect his reaction will only increase the interest of the House Democratic Majority to act," Rep. Darren Soto, the co-chair of the Congressional Blockchain Caucus, said in an emailed statement to Cheddar. "We must boldly forge ahead in cryptocurrency technology and regulations or be left behind by China, Russia and other countries that don't share our democratic values. We look forward to next week's hearing in Congress as an educational opportunity on the economic benefits for the United States."

The Blockchain Association, a D.C.-based advocate for the technology, responded on Twitter.

Meanwhile, the Chamber of Digital Commerce, another advocacy group for blockchain technologies and digital assets, has announced a "Congressional Blockchain Education Day" on Capitol Hill the day following the hearings on Libra. Facebook would not comment on the president's tweets, but earlier this week, the company did send letters to both the House Financial Services Committee ⁠— the chairwoman of which, Rep. Maxine Waters, has urged Facebook to pause work on the currency ⁠— and the Senate Banking Committee, aiming to assuage regulators and officials.

However, Sherrod Brown, the Senate Banking Committee's ranking member, wasn't satisfied. In a Thursday statement, he said: "Facebook failed to provide answers about Libra. I want real answers during next week's hearing and I'm calling on our financial watchdogs to scrutinize Libra closely to ensure users are protected."

When asked about Libra during a hearing on Capitol Hill Thursday, Federal Reserve Chair Jerome Powell expressed doubts, saying there were "serious concerns" with the project, which has raised questions over its privacy protections and financial regulation, as well as the ever-growing size and power of large technology platforms.