tl;dr
Senators Elizabeth Warren and Richard Blumenthal sent a letter to Meta CEO Mark Zuckerberg demanding answers about Meta's renewed interest in stablecoin payments. They warned that Meta issuing its own stablecoin could threaten competition, erode financial privacy, and give the company excessive econ...
Senators Elizabeth Warren and Richard Blumenthal have formally demanded an explanation from Meta CEO Mark Zuckerberg regarding the company's renewed interest in stablecoin payments. They expressed concerns that Meta issuing its own stablecoin could undermine competition, compromise financial privacy, and concentrate excessive economic power given Meta’s vast user base of 3.5 billion daily active users.
The senators’ inquiry was prompted by reports that Meta is in discussions with various crypto firms about integrating stablecoins into platforms such as Instagram, Facebook, and WhatsApp. This move signals a comeback following the collapse of Meta's earlier Libra project, later renamed Diem, which was abandoned amid heavy regulatory challenges and bipartisan political opposition.
In a detailed letter, Warren and Blumenthal highlighted Meta’s troubling track record and warned that controlling a stablecoin might allow the company unprecedented insight into consumer transactions, increasing risks related to data surveillance and monetization. They cautioned that Meta could exploit consumer data for intrusive targeted advertising or even sell sensitive information to third-party brokers.
The senators have requested that Zuckerberg respond by June 17 with specifics about Meta’s stablecoin ambitions, including details about consultations with crypto companies, lobbying activities related to crypto legislation, and Meta’s position on legislative efforts restricting Big Tech firms from controlling stablecoin issuers.
This investigation aligns with recent Senate developments, notably the advancement of the GENIUS Act, which would permit Big Tech firms like Meta to issue their own stablecoins. Senator Warren has strongly criticized the legislation, warning that it would facilitate corruption and expand corporate control over currency systems.
Meta has previously denied working on a stablecoin, with communications director Andy Stone confirming on social media earlier that no such project is underway. As the financial landscape evolves, the intersection of Big Tech and digital currency regulation remains a critical and closely watched area for policymakers and investors alike.