The launch of Facebook’s Libra currency and discussions at the G20 Summit about financial fraud and tax evasion with digital assets has ‘lit a fire under policymakers’ to develop better regulatory responses.
Five US lawmakers have written an open letter to Facebook, dated July 2, that calls for the social media company to pause developments on its cryptocurrency while US lawmakers examine the risks it poses.
Congress intends to “hold public hearings on the risks and benefits of cryptocurrency-based activities and explore legislative solutions,” the letter states. “Failure to cease implementation before we can do so risks a new Swiss-based financial system that is too big to fail,” it warns.
The demand comes just week after the G20 examined cryptocurrency tax evasion during its discussions on corporate fraud in late June. Talks were based on updates from the International Financial Action Task Force (FATF) after it investigated virtual assets and released international recommendations on how to tax and monitor these.