Don’t take Facebook’s word for it

editorial. The U.S. company’s previous missteps should prompt financial regulators to pay close attention to the launch of the electronic currency “Libra.”

The World editorial. “Your money interests me,” says an advertisement for a major French bank. Facebook is less direct, but the intent is the same. After caring about who we frequent, where we travel, what we like to eat or who we vote for, social networks now have the ambition to follow our wallets. Mark Zuckerberg’s company just announced that it will launch an electronic currency in 2020: “Libra.” The fact that Facebook is interested in our money constitutes a potential upheaval in the world of financial transactions that must wake us up.

Silicon Valley is unrivaled in its initiatives to showcase its modernity and utility. With e-wallets, Libra can not only transfer money in an easy, instant, secure and inexpensive way, but also buy a variety of goods and services.

The group has been careful to distance itself from the controversial and speculative model of bitcoin, whose value is not based on any tangible asset. Libra is presented as a “stable currency” whose price will be determined by a basket of currencies (USD, EUR, JPY, GBP). In this regard, Facebook’s initiative does not question the monetary sovereignty conferred on countries, at least initially, but it promises to challenge the hegemony of traditional banks in financial transactions in a radical way.

2.7 billion users
The problem is that Facebook wasn’t the first company to come. With 2.7 billion users, 1 billion Instagram followers, and its satellite messengers (Messenger and WhatsApp), Mark Zuckerberg’s team’s firepower is matched only by a disastrous reputation for reliability. The Cambridge Analytica scandal exposed the social network’s extreme neglect in protecting its users’ data, while its inability to truly control a dizzyingly viral campaign of hate speech and defamation.

If these major failures have so far had a limited impact on MNCs’ turnover, they have reason to be on high alert. The issue is now more than just protecting personal data. Ten years after the 2008 financial crisis, banks have been painstakingly regulated due to tighter regulations. We have to think twice before making Facebook a player at the scale that can bring new forms of instability to the system.

If today’s library is just a trading tool, there’s nothing to say that Mark Zuckerberg would stop in such a good way. Facebook, which generates 98% of its revenue from advertising, clearly needs to diversify its business model, which could eventually lead it to develop increasingly complex financial products and even mint coins.

Every time Mark Zuckerberg is held accountable for his business abuses, he just adds excuses. Maybe it’s time to stop taking his word for it. This time, financial regulators must take the lead in strictly regulating a company that often plays wizards’ apprentices.

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