Facebook's 'Libra' project met with resistance on Capitol Hill

SAN JOSE, Calif. (KGO) -- Facebook's plans to enter the world of cryptocurrency and global finance are being met with resistance on Capitol Hill.

"Facebook is dangerous," said Sen. Sherrod Brown of Ohio at a Senate Banking Committee hearing Tuesday afternoon. "Facebook has said 'just trust us.' And every time Americans trust you, they seem to get burned."

Some in Silicon Valley are already skeptical about Facebook's efforts.

RELATED: Facebook launching its own cryptocurrency, Libra, for 2 billion-plus users

"Cryptocurrency just doesn't really do it for me," said Facebook user Kirk Moreland. "To me, it's just not real."

The Menlo Park-based company's goal is to offer an alternative financial system that would make it possible to send money around the world with little to no fees.

"If America doesn't lead innovation in the digital currency and payments area, others will," said Facebook vice president, David Marcus, during his remarks at the Senate hearing.

Cryptocurrency, such as Bitcoin, can be appealing because of the idea that digital currencies are typically free from government control.

"Facebook knows exactly that the trust is missing and they cannot do it by themselves," said cybersecurity expert and SJSU engineering professor, Ahmed Banafa, who is glad the U.S. government is taking a closer look at Libra.

RELATED: Facebook launching its own cryptocurrency, Libra, for 2 billion-plus users

Libra would enable more transactions between Facebook users and businesses on its platforms, which could generate more ad revenue for the company. However, there is growing concern over cryptocurrency being misused.

"Not be abused by for example, the money laundering, human trafficking, or terrorists, using this kind of technology. That's the main concern for the government," said Banafa.

Some say any impacts on monetary policy are at this point overblown.

"From the perspective of people who are maybe transferring money overseas, fees for doing so right now are fairly high, and that might bring in some competition into that market," said SJSU economics professor Justin Rietz.

Facebook executives are scheduled to appear before the House Financial Services Committee on Wednesday.
Copyright © 2021 KGO-TV. All Rights Reserved.