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House lawmakers ask Facebook to put Libra cryptocurrency project on hold

143 points by smacktoward 7y ago

jbverschoor 7y ago
“These vulnerabilities could be exploited and obscured by bad actors, as other cryptocurrencies, exchanges, and wallets have been in the past.” Says one bad actor to the other bad actor.
- colonelpopcorn 7y ago
  I really want to see what happens if Facebook says no.
  - dmoy 7y ago
    It would not go well for Facebook. Their lawyers won't let them say no.
    - yeahitslikethat 7y ago
      Zucks the boss tho. I'd like to see it too. And I don't even use Facebook.
  - mythrwy 7y ago
    Maybe Facebook doesn't say "no". Maybe Facebook says "How about if we share all the data with your agents real time through an API."? BTW Maxine, isn't your re-election coming up? We really like what you are doing in Washington here's a check for some signs. (or something along these lines)
  - malandrew 7y ago
    It's not a law, it's a request. You just acquiesce without making any concrete commitments and carry on as if the request was never made.
- archy_ 7y ago
  Years of market manipulation is fine as long as you're a federal agency with the backing of major banks. It's like the US complaining about Russia proxy wars and election interference - who do you think they learned those techniques from?
higginsc 7y ago
>“Because Facebook is already in the hands of over a quarter of the world’s population, it is imperative that Facebook and its partners immediately cease implementation plans until regulators and Congress have an opportunity to examine these risks and take action,” the letter says. We're scared that you have the ability to disintermediate our control of the financial system just like you did to publishers.
- maxaf 7y ago
  Forced to choose between Facebook and a government controlling anything, I'd rather have the government at the wheel. For me this is a "devil I know" type of thing.
  - smacktoward 7y ago
    With government, you also get periodic opportunities to vote on whether or not it should change course. It's hard to change a government's direction with the ballot box, of course, but it's not impossible. Contrast this to Facebook, which is structured specifically to prevent even large shareholders from having a say in its operations. Facebook is the Empire of Zuck, and the only factor that matters in its decisionmaking are the whims of its boy king.
    - CuriousSkeptic 7y ago
      I don’t think the interest of other large shareholders would be more aligned with the interest of the general population though.
  - ksdale 7y ago
    I’m probably reading too much into your comment, but there’s a big difference between “a” government and “the” government depending on where you live. I don’t trust Facebook at all, but I trust them more than I trust certain governments around the world. At least they don’t have a military. Sometimes assholes without guns are better to have in charge than anyone with guns.
crazygringo 7y ago
This gets it all wrong, IMHO. An "official ask" rather than actual laws or regulations comes across as silly, self-serving and grandstanding -- although it is in Facebook's self-interest to work with Congress. The problem here is the potential for uncompetitive dominance -- just like Google or Apple can unfairly favor their own products in Search or apps, what does it mean for Facebook to favor or only allow its own currency option in transactions/marketplace/etc.? Far better would be Congress ensuring freedom of choice -- let Facebook develop its own currency, but make sure that anywhere it's provided as an option on Facebook/Instagram/etc. there's also an equivalently frictionless way to use Apple Pay, Google Pay, PayPal, MasterCard, etc. Force payment methods and currencies to compete on a level playing field, instead of by which mega-company forces them as exclusive options.
- ptah 7y ago
  I think they are asking them to delay development so they can do proper investigation into possible effects before regulating
- MuffinFlavored 7y ago
  How will Libra cut into the US credit card processing margins? Stripe will charge small customers 2.9% + $0.30 per transaction, and I'm sure large customers get as low as 0.9%. Does Libra stand to cannibalize that margin/business model over night?
- whateveracct 7y ago
  > An "official ask" rather than actual laws or regulations comes across as silly, self-serving and grandstanding Libra was announced extremely recently. Do you really expect lawmakers to push laws or regulations through the system that fast? Surely not. If anything, an "official ask" like this is one of Congress' many tools.
  - dsfyu404ed 7y ago
    >Do you really expect lawmakers to push laws or regulations through the system that fast? Surely not. The GP's expectation aside, I don't want the government to be able to make laws that quickly. Knee jerk laws rarely work well.
mcoliver 7y ago
Link to the Full text and release here: https://financialservices.house.gov/news/documentsingle.aspx?DocumentID=404009 https://financialservices.house.gov/news/documentsingle.aspx... PDF: https://financialservices.house.gov/uploadedfiles/07.02.2019_-_fb_ltr.pdf https://financialservices.house.gov/uploadedfiles/07.02.2019...
- naveen99 7y ago
  Thanks. How does one cease a plan. Can imagine ceasing the implementation itself, but a plan ? Why don’t they just ask Mark to stop thinking for a while... But it makes sense, they probably want to learn from tether first.
seibelj 7y ago
Official Facebook summary of the past two weeks, responding to many criticisms: https://www.facebook.com/notes/david-marcus/libra-2-weeks-in/10158616513819148/ https://www.facebook.com/notes/david-marcus/libra-2-weeks-in...
- paulgb 7y ago
  Most amusing to me is the question "Can Facebook be trusted to manage financial services?" to which Facebook's own answer is not an emphatic "yes", but an explanation that they will not control it.
  - Zenbit_UX 7y ago
    I don't see how the only reasonable response to such a stupid question amuses you. If they had responded with an emphatic yes they would have been crucified in the media immediately.
    - craftyguy 7y ago
      Not GP, but I find it amusing that anyone is even paying attention to facebook's response to the question. Of course they're going to give a muted, unemphatic yes (as you said), and the public seem to believe them and end all questioning there. Luckily the US government is not giving up so easily.
JohnJamesRambo 7y ago
The government hates it when you try to make a new ponzi to replace the one they have got going.
- simonh 7y ago
  Alongside their Ponzi. It wouldn't really replace anything, any more that BTC has replaced Dollars. The only thing anyone cares about with respect to BTC is how many dollars they are worth.
  - leetcrew 7y ago
    aside from the volatility, one of the major reasons it hasn't attained wide adoption is simply friction. the average consumer or small business doesn't want to think too hard about how to pay or receive payment for things. if Facebook released a simple libra api and many merchants adopted it, we might see it get used a lot more than btc.
  - Fellshard 7y ago
    That's been key all along - as long as cryptocurrency remains anchored in real currency value for the majority of exchanges, then it will fail to stand on its own, as the cost of transfer to and from BTC will be too steep to warrant.
rolltiide 7y ago
Dan Larimer's EOS functions very similar to Libra, with Delegated Proof of Stake. EOS' DPOS encountered much of the same criticisms around centralization when it was launched, but many people swear by it just because it is good enough. Delegates ("block producers") do reverse transactions on EOS and they consider it a feature. EOS is not immutable, but it does have faster transaction capacity than incumbent chains like Ethereum and Bitcoin. If Dan Larimer had launched Libra instead of Zuckerberg even with the same corporate block producers, a lot of the crypto community would be loving it. Governments would have ignored it. This is all about the messenger itself. Zuckerberg deciding to crucify himself and be the focus of society's disdain. Nice to see the state's monopoly on money evaporating overnight. Its not about whether this iteration would be better for society, its more about the competition existing.
- 1in21m 7y ago
  EOS = centralized premined scam.
- deleted 7y ago
  [deleted]
nickthemagicman 7y ago
Think of how much personal data Facebook could gather on you if it knows 'EVERYTHING' you purchase or at least a huge part of what you purchase. They've already been busted selling personal data under the radar to third parties. It's less 'omg control of the financial system' and more 'you're not exactly the exemplar of trust with peoples personal data' I'm all for crypto making the lame financial system we currently have obsolete but I don't know if Facebook are the most trustworthy people to do it.
- darkwizard42 7y ago
  Please read the Libra whitepapers and organizational notes. You don't need a Facebook account to use it and they wouldn't have control of the personal data on your spending...
ckastner 7y ago
> This is why we believe in and are committed to a collaborative process with regulators, central banks, and lawmakers to ensure that Libra helps with the kinds of issues that the existing financial system has been fighting, notably around money laundering, terrorism financing, and more. This was inevitable, but it's surprising to see them acknowledge it. > combined with the ability for law enforcement and regulators to conduct their own analysis of on-chain activity [...] Libra should improve detection and enforcement, not set these back. I expressed concern that this would happen a while ago [1]. This basically bypasses all privacy safeguards that clients would enjoy at a regular bank. [1] https://news.ycombinator.com/item?id=20263861 https://news.ycombinator.com/item?id=20263861
- hjk05 7y ago
  This might depend on what you consider a “regular bank” but every bank and exchange I’ve ever come into contact with requires documentation and vetting to ensure that I am who I say I am and that I’m not not laundering money, and if the police come with a warrant they get everything they ask for. I think you might be thinking of specific banks and shell company schemes in Panama and not what most people would describe as a regular bank.
  - aNoob7000 7y ago
    Bank Secrecy Act (BSA) and Know Your Customer (KYC). I'm going out on a limb to say that most tech companies have no idea what BSA or KYC means and the paperwork involved.
    - mintiquity 7y ago
      Facebook already knows more about you than KYC requires. That said, according to Forbes (https://www.forbes.com/sites/francescoppola/2019/06/30/the-real-threat-from-facebooks-libra-coin https://www.forbes.com/sites/francescoppola/2019/06/30/the-r...), they'll comply with KYC/AML. I can't find a statement direct from Facebook on that, though.
      - 7y ago
luckydata 7y ago
This is not surprising. The minute Libra starts operating it becomes the main money laundering tool in the world. Depending on how it's implemented it could easily topple the economies of smaller countries, and significantly increase funding for terrorist organizations and garden variety criminals. I don't see how any government, and especially the US government, agrees to any of that anytime soon.
- solotronics 7y ago
  lol.. I don't think people realize how the legacy banking systems already facilitate this activity HSBC was recently fined for laundering billions for the cartels. This activity happens on an industrial scale and a Facebook cryptocurrency isn't needed for these groups to move money.
  - luckydata 7y ago
    I'm not sure how I should reply to this. You really believe I don't know how money laundering is currently performed?
  - sdinsn 7y ago
    Of course laundering already occurs. But that doesn't mean we should ignore things that could further enable it.
- codehalo 7y ago
  How will it become a main money laundering or terrorist tool? Can you elaborate? A launderer or terrorist (actually ANYBODY - good or bad) would have to be the biggest fucking idiot to use Libra and expect the transaction to be anonymous or private. I sincerely hope you were just whipping out the typical ML/T FUD and don't believe that yourself.
- anchpop 7y ago
  What does libra do for money laundering that other currencies like zcash and nano don't already do much better?
julianozen 7y ago
Could the government effectively regulate/curtail libra by essentially telling Facebook's financial partners like Visa, Mastercard, PayPal, Stripe, etc that they risk losing their licenses by promoting/handling Libra?
- elliekelly 7y ago
  In theory maybe, but I don’t think you’d find a politician willing to risk their reputation to pull the plug on Visa. Not only would it be a major blow to the economy but it would be a giant pain in the ass for their constituents. When’s the last time you went into a bank to take out cash? When’s the last time you had cash in your wallet at all? Visa wouldn’t be the biggest loser in that scenario, the politicians/regulators would.
- carlosdp 7y ago
  They don't have to go that extreme, they could just tax Libra coins like securities. That would create a huge burden on their use as currency in the US.
kevmo 7y ago
Good.
rwmj 7y ago
The Financial Times speculated that Libra transactions - because they involve some currency risk - will incur capital gains taxes (CGT). Although the CGT absolute amounts are likely to be very small, and in some countries will be covered by a personal allowance, this will still cause tremendously fiddly problems when filing taxes. I'm afraid the link to the FT article is behind a paywall, but this blog post summarises it: https://www.taxresearch.org.uk/Blog/2019/07/01/facebooks-libra-and-tax/ https://www.taxresearch.org.uk/Blog/2019/07/01/facebooks-lib...
- carlosdp 7y ago
  It's not even the amounts that would be the killer if it's capital gains taxed really, it's the overhead come tax filing time for the average American.
  - londons_explore 7y ago
    Except Facebook can just write an algorithm to calculate it all for you, and then say "write 16.47 in box 18". Facebook could even promise to cover all the taxes owed, which would give them an incentive to keep the currency value stable.
    - runeks 7y ago
      > Facebook could even promise to cover all the taxes owed, which would give them an incentive to keep the currency value stable. Stable compared to what? If the Euro falls relative to the Libra (same as Libra gaining against the Euro) then Europeans owe capital gains tax. Same goes for USD/Americans, CNY/Chinese people, etc.
6gvONxR4sf7o 7y ago
People here are talking like the government is trying to do something bad. If this were goldman sachs instead of facebook, we'd be cheering. The financial system is complex and having the wrong incentive systems (regulations) in place can lead to trememdous harm throughout the world. If you were working when the 2008 recession hit, you're familiar with the kinds of issues that financial regulation works to deter.
- 2_listerine_pls 7y ago
  > People are talking like the government is trying to do something bad. Based on 1 article you read
  - 6gvONxR4sf7o 7y ago
    You missed an important word in your quotation.
csomar 7y ago
Imo, Facebook released its plans in the last minute, so that it can have time to launch before regulator catches up. The later they catch up, the more likely Facebook is going to dominate the market and become harder to roll back the currency. Facebook is probably aware of government regulators looking to control it more and certainly anxious about voices looking to break it. The Libra coin being established as a pseudonymous crypto-currency in Switzerland will give it some time to figure stuff out.
- carlosdp 7y ago
  How is a year ahead of launch "last minute"?
ilaksh 7y ago
The fact that this is centralized, based on fiat, easily connected to social media accounts, actually makes it the best way for governments to combat real cryptocurrency. But I hope they don't figure that out, and give Ethereum and Bitcoin time to finish their scaling efforts.
hnsocks 7y ago
FB need to put money on lawmakers pocket only.. then all laws can be rewritten

143 points by smacktoward 7y ago

“These vulnerabilities could be exploited and obscured by bad actors, as other cryptocurrencies, exchanges, and wallets have been in the past.” Says one bad actor to the other bad actor.

colonelpopcorn 7y ago
I really want to see what happens if Facebook says no.
- dmoy 7y ago
  It would not go well for Facebook. Their lawyers won't let them say no.
  - yeahitslikethat 7y ago
    Zucks the boss tho. I'd like to see it too. And I don't even use Facebook.
- mythrwy 7y ago
  Maybe Facebook doesn't say "no". Maybe Facebook says "How about if we share all the data with your agents real time through an API."? BTW Maxine, isn't your re-election coming up? We really like what you are doing in Washington here's a check for some signs. (or something along these lines)
- malandrew 7y ago
  It's not a law, it's a request. You just acquiesce without making any concrete commitments and carry on as if the request was never made.
archy_ 7y ago
Years of market manipulation is fine as long as you're a federal agency with the backing of major banks. It's like the US complaining about Russia proxy wars and election interference - who do you think they learned those techniques from?

higginsc 7y ago

>“Because Facebook is already in the hands of over a quarter of the world’s population, it is imperative that Facebook and its partners immediately cease implementation plans until regulators and Congress have an opportunity to examine these risks and take action,” the letter says. We're scared that you have the ability to disintermediate our control of the financial system just like you did to publishers.

maxaf 7y ago
Forced to choose between Facebook and a government controlling anything, I'd rather have the government at the wheel. For me this is a "devil I know" type of thing.
- smacktoward 7y ago
  With government, you also get periodic opportunities to vote on whether or not it should change course. It's hard to change a government's direction with the ballot box, of course, but it's not impossible. Contrast this to Facebook, which is structured specifically to prevent even large shareholders from having a say in its operations. Facebook is the Empire of Zuck, and the only factor that matters in its decisionmaking are the whims of its boy king.
  - CuriousSkeptic 7y ago
    I don’t think the interest of other large shareholders would be more aligned with the interest of the general population though.
- ksdale 7y ago
  I’m probably reading too much into your comment, but there’s a big difference between “a” government and “the” government depending on where you live. I don’t trust Facebook at all, but I trust them more than I trust certain governments around the world. At least they don’t have a military. Sometimes assholes without guns are better to have in charge than anyone with guns.

crazygringo 7y ago

This gets it all wrong, IMHO. An "official ask" rather than actual laws or regulations comes across as silly, self-serving and grandstanding -- although it is in Facebook's self-interest to work with Congress. The problem here is the potential for uncompetitive dominance -- just like Google or Apple can unfairly favor their own products in Search or apps, what does it mean for Facebook to favor or only allow its own currency option in transactions/marketplace/etc.? Far better would be Congress ensuring freedom of choice -- let Facebook develop its own currency, but make sure that anywhere it's provided as an option on Facebook/Instagram/etc. there's also an equivalently frictionless way to use Apple Pay, Google Pay, PayPal, MasterCard, etc. Force payment methods and currencies to compete on a level playing field, instead of by which mega-company forces them as exclusive options.

ptah 7y ago
I think they are asking them to delay development so they can do proper investigation into possible effects before regulating
MuffinFlavored 7y ago
How will Libra cut into the US credit card processing margins? Stripe will charge small customers 2.9% + $0.30 per transaction, and I'm sure large customers get as low as 0.9%. Does Libra stand to cannibalize that margin/business model over night?
whateveracct 7y ago
> An "official ask" rather than actual laws or regulations comes across as silly, self-serving and grandstanding Libra was announced extremely recently. Do you really expect lawmakers to push laws or regulations through the system that fast? Surely not. If anything, an "official ask" like this is one of Congress' many tools.
- dsfyu404ed 7y ago
  >Do you really expect lawmakers to push laws or regulations through the system that fast? Surely not. The GP's expectation aside, I don't want the government to be able to make laws that quickly. Knee jerk laws rarely work well.

mcoliver 7y ago

Link to the Full text and release here: https://financialservices.house.gov/news/documentsingle.aspx?DocumentID=404009 https://financialservices.house.gov/news/documentsingle.aspx... PDF: https://financialservices.house.gov/uploadedfiles/07.02.2019_-_fb_ltr.pdf https://financialservices.house.gov/uploadedfiles/07.02.2019...

naveen99 7y ago
Thanks. How does one cease a plan. Can imagine ceasing the implementation itself, but a plan ? Why don’t they just ask Mark to stop thinking for a while... But it makes sense, they probably want to learn from tether first.

seibelj 7y ago

Official Facebook summary of the past two weeks, responding to many criticisms: https://www.facebook.com/notes/david-marcus/libra-2-weeks-in/10158616513819148/ https://www.facebook.com/notes/david-marcus/libra-2-weeks-in...

paulgb 7y ago
Most amusing to me is the question "Can Facebook be trusted to manage financial services?" to which Facebook's own answer is not an emphatic "yes", but an explanation that they will not control it.
- Zenbit_UX 7y ago
  I don't see how the only reasonable response to such a stupid question amuses you. If they had responded with an emphatic yes they would have been crucified in the media immediately.
  - craftyguy 7y ago
    Not GP, but I find it amusing that anyone is even paying attention to facebook's response to the question. Of course they're going to give a muted, unemphatic yes (as you said), and the public seem to believe them and end all questioning there. Luckily the US government is not giving up so easily.

JohnJamesRambo 7y ago

The government hates it when you try to make a new ponzi to replace the one they have got going.

simonh 7y ago
Alongside their Ponzi. It wouldn't really replace anything, any more that BTC has replaced Dollars. The only thing anyone cares about with respect to BTC is how many dollars they are worth.
- leetcrew 7y ago
  aside from the volatility, one of the major reasons it hasn't attained wide adoption is simply friction. the average consumer or small business doesn't want to think too hard about how to pay or receive payment for things. if Facebook released a simple libra api and many merchants adopted it, we might see it get used a lot more than btc.
- Fellshard 7y ago
  That's been key all along - as long as cryptocurrency remains anchored in real currency value for the majority of exchanges, then it will fail to stand on its own, as the cost of transfer to and from BTC will be too steep to warrant.

rolltiide 7y ago

Dan Larimer's EOS functions very similar to Libra, with Delegated Proof of Stake. EOS' DPOS encountered much of the same criticisms around centralization when it was launched, but many people swear by it just because it is good enough. Delegates ("block producers") do reverse transactions on EOS and they consider it a feature. EOS is not immutable, but it does have faster transaction capacity than incumbent chains like Ethereum and Bitcoin. If Dan Larimer had launched Libra instead of Zuckerberg even with the same corporate block producers, a lot of the crypto community would be loving it. Governments would have ignored it. This is all about the messenger itself. Zuckerberg deciding to crucify himself and be the focus of society's disdain. Nice to see the state's monopoly on money evaporating overnight. Its not about whether this iteration would be better for society, its more about the competition existing.

1in21m 7y ago
EOS = centralized premined scam.
deleted 7y ago
[deleted]

nickthemagicman 7y ago

Think of how much personal data Facebook could gather on you if it knows 'EVERYTHING' you purchase or at least a huge part of what you purchase. They've already been busted selling personal data under the radar to third parties. It's less 'omg control of the financial system' and more 'you're not exactly the exemplar of trust with peoples personal data' I'm all for crypto making the lame financial system we currently have obsolete but I don't know if Facebook are the most trustworthy people to do it.

darkwizard42 7y ago
Please read the Libra whitepapers and organizational notes. You don't need a Facebook account to use it and they wouldn't have control of the personal data on your spending...

ckastner 7y ago

> This is why we believe in and are committed to a collaborative process with regulators, central banks, and lawmakers to ensure that Libra helps with the kinds of issues that the existing financial system has been fighting, notably around money laundering, terrorism financing, and more. This was inevitable, but it's surprising to see them acknowledge it. > combined with the ability for law enforcement and regulators to conduct their own analysis of on-chain activity [...] Libra should improve detection and enforcement, not set these back. I expressed concern that this would happen a while ago [1]. This basically bypasses all privacy safeguards that clients would enjoy at a regular bank. [1] https://news.ycombinator.com/item?id=20263861 https://news.ycombinator.com/item?id=20263861

hjk05 7y ago
This might depend on what you consider a “regular bank” but every bank and exchange I’ve ever come into contact with requires documentation and vetting to ensure that I am who I say I am and that I’m not not laundering money, and if the police come with a warrant they get everything they ask for. I think you might be thinking of specific banks and shell company schemes in Panama and not what most people would describe as a regular bank.
- aNoob7000 7y ago
  Bank Secrecy Act (BSA) and Know Your Customer (KYC). I'm going out on a limb to say that most tech companies have no idea what BSA or KYC means and the paperwork involved.
  - mintiquity 7y ago
    Facebook already knows more about you than KYC requires. That said, according to Forbes (https://www.forbes.com/sites/francescoppola/2019/06/30/the-real-threat-from-facebooks-libra-coin https://www.forbes.com/sites/francescoppola/2019/06/30/the-r...), they'll comply with KYC/AML. I can't find a statement direct from Facebook on that, though.
    - 7y ago

luckydata 7y ago

This is not surprising. The minute Libra starts operating it becomes the main money laundering tool in the world. Depending on how it's implemented it could easily topple the economies of smaller countries, and significantly increase funding for terrorist organizations and garden variety criminals. I don't see how any government, and especially the US government, agrees to any of that anytime soon.

solotronics 7y ago
lol.. I don't think people realize how the legacy banking systems already facilitate this activity HSBC was recently fined for laundering billions for the cartels. This activity happens on an industrial scale and a Facebook cryptocurrency isn't needed for these groups to move money.
- luckydata 7y ago
  I'm not sure how I should reply to this. You really believe I don't know how money laundering is currently performed?
- sdinsn 7y ago
  Of course laundering already occurs. But that doesn't mean we should ignore things that could further enable it.
codehalo 7y ago
How will it become a main money laundering or terrorist tool? Can you elaborate? A launderer or terrorist (actually ANYBODY - good or bad) would have to be the biggest fucking idiot to use Libra and expect the transaction to be anonymous or private. I sincerely hope you were just whipping out the typical ML/T FUD and don't believe that yourself.
anchpop 7y ago
What does libra do for money laundering that other currencies like zcash and nano don't already do much better?

julianozen 7y ago

Could the government effectively regulate/curtail libra by essentially telling Facebook's financial partners like Visa, Mastercard, PayPal, Stripe, etc that they risk losing their licenses by promoting/handling Libra?

elliekelly 7y ago
In theory maybe, but I don’t think you’d find a politician willing to risk their reputation to pull the plug on Visa. Not only would it be a major blow to the economy but it would be a giant pain in the ass for their constituents. When’s the last time you went into a bank to take out cash? When’s the last time you had cash in your wallet at all? Visa wouldn’t be the biggest loser in that scenario, the politicians/regulators would.
carlosdp 7y ago
They don't have to go that extreme, they could just tax Libra coins like securities. That would create a huge burden on their use as currency in the US.

kevmo 7y ago

Good.

rwmj 7y ago

The Financial Times speculated that Libra transactions - because they involve some currency risk - will incur capital gains taxes (CGT). Although the CGT absolute amounts are likely to be very small, and in some countries will be covered by a personal allowance, this will still cause tremendously fiddly problems when filing taxes. I'm afraid the link to the FT article is behind a paywall, but this blog post summarises it: https://www.taxresearch.org.uk/Blog/2019/07/01/facebooks-libra-and-tax/ https://www.taxresearch.org.uk/Blog/2019/07/01/facebooks-lib...

carlosdp 7y ago
It's not even the amounts that would be the killer if it's capital gains taxed really, it's the overhead come tax filing time for the average American.
- londons_explore 7y ago
  Except Facebook can just write an algorithm to calculate it all for you, and then say "write 16.47 in box 18". Facebook could even promise to cover all the taxes owed, which would give them an incentive to keep the currency value stable.
  - runeks 7y ago
    > Facebook could even promise to cover all the taxes owed, which would give them an incentive to keep the currency value stable. Stable compared to what? If the Euro falls relative to the Libra (same as Libra gaining against the Euro) then Europeans owe capital gains tax. Same goes for USD/Americans, CNY/Chinese people, etc.

6gvONxR4sf7o 7y ago

People here are talking like the government is trying to do something bad. If this were goldman sachs instead of facebook, we'd be cheering. The financial system is complex and having the wrong incentive systems (regulations) in place can lead to trememdous harm throughout the world. If you were working when the 2008 recession hit, you're familiar with the kinds of issues that financial regulation works to deter.

2_listerine_pls 7y ago
> People are talking like the government is trying to do something bad. Based on 1 article you read
- 6gvONxR4sf7o 7y ago
  You missed an important word in your quotation.

csomar 7y ago

Imo, Facebook released its plans in the last minute, so that it can have time to launch before regulator catches up. The later they catch up, the more likely Facebook is going to dominate the market and become harder to roll back the currency. Facebook is probably aware of government regulators looking to control it more and certainly anxious about voices looking to break it. The Libra coin being established as a pseudonymous crypto-currency in Switzerland will give it some time to figure stuff out.

carlosdp 7y ago
How is a year ahead of launch "last minute"?

ilaksh 7y ago

The fact that this is centralized, based on fiat, easily connected to social media accounts, actually makes it the best way for governments to combat real cryptocurrency. But I hope they don't figure that out, and give Ethereum and Bitcoin time to finish their scaling efforts.

hnsocks 7y ago

FB need to put money on lawmakers pocket only.. then all laws can be rewritten