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Facebook's Zuckerberg Fails To Ease Lawmaker Concerns With Congressional Testimony

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Facebook's Zuckerberg Fails To Ease Lawmaker Concerns With Congressional Testimony

Facebook, Inc. (NASDAQ: FB) CEO Mark Zuckerberg spoke in front of the U.S. House Financial Services Committee on Wednesday to better explain his Libra cryptocurrency ambitions.

But after a lengthy talk and fielding answers from lawmakers, he failed to win new friends on either side of the aisle, according to CNBC.

Nothing New Presented

The Facebook CEO said the social media company will only proceed with its Libra initiative if it is granted regulatory approval to do so, CNBC reported.

U.S. Rep. Maxine Waters, the California Democrat who chairs the committee, said Zuckerberg failed to "adequately" explain what Libra is and who it serves.

"To simply say that you're organizing Libra because you're concerned about the unbanked and it's going to have payments systems does not answer the questions for me," Waters said. 

Across the aisle, ranking member Rep. Patrick McHenry, a North Carolina Republican, said: "frankly, I'm not sure that we've learned anything new here."

Axios: Not Enough Time Allocated To Libra

Axios media reporter Sara Fischer told CNBC that lawmakers didn't allocate enough time to discuss Libra. Important questions, such as whether Facebook will make a profit on Libra and the impact on its ad business, should have been discussed, she said. 

"We don't know because lawmakers didn't spend enough time pressing him on it."

Libra's core purpose of serving people across the world who have no access to bank accounts could be a positive, Fischer said. 

But it could also be "abused" in ways that can't be imagined today, which represents another concern for lawmakers, she said. 

Jefferies: Libra The 'Wrong Path' For Facebook

No evidence exists tosuggest that Facebook's Libra will succeed, Jefferies analyst Brent Thill told CNBC.

The social media company has multiple other initiatives it can invest in to drive further monetization, the analyst said. 

"The advertising opportunity is still incredibly large in their core," he said "We think [Libra] is nice to have — not a must-have."

Facebook shares were down 1.34% at $183.65 at the time of publication. 

Related Links:

Facebook Open To Changes To Libra Vision Ahead Of June 2020 Launch

Germany Joins France In Pushing Back Against Facebook's Libra

Photo courtesy of Facebook. 

 

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