The number of fake accounts already online — some of which offer discounted Libra if people click through to another website — show how Facebook is “struggling to rebuild trust and fight the fraud likely to surround the new financial system,” according to The Washington Post.
Earlier this month, The US Federal Reserve System added its voice to the chorus of doubts raised by lawmakers, politicians and others worldwide about Libra. Libra has faced considerable skepticism and pushback since being announced, with US and European politicians almost immediately expressing concerns that stem from Facebook’s history of data security problems.
At the start of July, David Marcus, head of Calibra, said the Libra Association is “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.”
Known in the crypto community as “CZ,” the digital currency exchange’s chief said Trump’s comments criticizing bitcoin and Facebook’s libra currency can only be good for the industry.
“Trump so far has not done anything positive or negative, he’s just said he’s not a fan,” Zhou told CNBC in an interview last week. “The fact that he tweeted about it, and the president of the United States is talking about cryptocurrency, it’s a good thing.”
Trump said in a series of tweets earlier this month that he was “not a fan” of cryptocurrencies like bitcoin, claiming they’re “not money.” He also directed his ire at Facebook’s plans to create a cryptocurrency, saying the firm should be subject to federal banking regulations.
Subsequently, Facebook’s blockchain chief David Marcus was grilled on Capitol Hill over libra, while bitcoin’s price has been subdued over the last week amid heightened regulatory concerns.
But CZ said that even if the U.S. made it illegal to own cryptocurrency — which he describes as the “worst case scenario” — it wouldn’t shatter the industry.
Authorities have frequently sounded the alarm over cryptocurrencies, worried about their potential use in illicit activities like fraud and money laundering. Massive cyberattacks have also shaken the industry, and Binance hasn’t been immune to that trend.
“Cryptocurrency will survive regardless of any one country,” he said. “Most countries that try to ban bitcoin cause their citizens to want cryptocurrency more.”
In May, the trading venue notified its users that it was hit with a major breach that saw hackers run off with around 7,000 bitcoins, which today equates to over $70 million. The firm said it would cover the incident “in full” and no user funds would be affected.
While CZ described the incident as “unfortunate,” he added it was “totally manageable” given the size of Binance’s revenues. The company made around $400 million in profits in 2018, and its boss said it expects to make even more this year.
If anything, he said, the heist — and Binance’s response to it — shows the industry brings a “new level of transparency” when it comes to finance. Binance is one of the biggest cryptocurrency exchanges in the world by trading volume.
“Banks get hacked but they’re not transparent with the numbers. You see billions of dollars in fines for banks,” he said. “Whereas with cryptocurrency there’s more transparency, which is actually good for the users because now they know what’s going on.”
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