Washington, DC – A bill introduced by Sens. Kirsten Gillibrand and Cynthia Lummis to revamp regulation of cryptocurrencies is little more than a giveaway to an industry that wraps itself in the mantle of innovation but poses serious risks to investors, consumers, and possibly even financial stability.
Washington, D.C. — A broad coalition of bank and credit union associations and consumer organizations submitted a letter today to the U.S. House Committee on Financial Services urging passage of the Close the ILC Loophole Act, introduced by Representatives Chuy Garcia (D-IL) and Lance Gooden (R-TX).
Today, in a letter to Congress, 17 national advocacy organizations representing consumers, investors, and digital rights concerns called on the House Financial Services Committee to hold a hearing scrutinizing the steps tech giant Google (Alphabet) is taking to enter the cryptocurrency and digital assets markets, and how such moves might negatively impact privacy rights, consumer protections and safeguards against economic concentration. The call echoes concerns raised previously by advocates regarding Facebook’s designs on the financial services sector with the introduction of its now scuttled stablecoin, Libra (renamed Diem).
We, the undersigned organizations, write to you as advocates of transparency in digital asset markets. The cryptocurrency market boom has led to large corporations investing in the field, including Facebook (now Meta), whose problematic “Libra” cryptocurrency proposal was scrutinized in a 2019 hearing held by the Committee, at your direction. Facebook has since abandoned the project in light of the concerns raised at this hearing and due to push back from policymakers, public interest organizations, and financial regulators.
“The administration’s order includes the recognition that the rapid growth of digital assets as instruments for financial speculation is creating a wide range of serious risks and harms for consumers, investors, and the public at large. It is important that the order recognizes and articulates a set of these risks, and a whole of government approach can help address the scale and scope of the potential harm. It will be important for the studies authorized by the order to generate useful data and momentum for decisive regulatory action,” said Mark Hays, senior policy analyst with AFR and Demand Progress.
Americans for Financial Reform’s Andrew Park spoke on the “Crypto’s Rapid Rise: The Future of Finance or Cause for Concern” panel at the Consumer Federation of America Virtual Financial Services Conference.
Following reports that Facebook is scaling up its cryptocurrency efforts with the launch of a pilot of its cryptocurrency wallet “Novi”, Demand Progress Education Fund and Americans for Financial Reform Education Fund released the following joint statement.
The AFR Education Fund sent a statement for the record to the House Financial Services Committee concerning Facebook’s proposal for the Libra digital token and payment system. The statement describes ways in which Facebook is attempting to create an unregulated financial product of potentially global scale and the dangers this would pose to the users of the token and the broader financial system.