Facebook reportedly faces EU antitrust scrutiny over its Libra cryptocurrency

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Regulatory scrutiny of Libra heats up.

Facebook plans to launch a new cryptocurrency in 2020.

Facebook’s new cryptocurrency, Libra, hasn’t even launched yet, but concerns about the project keep piling up.

The European Commission is currently investigating whether the new digital currency could unfairly shut out rivals, according to Bloomberg, which cited a questionnaire by EU antitrust regulators.

Facebook and 27 partners unveiled plans for the cryptocurrency in June. Since then, the social media giant has faced pushback from US lawmakers who worry that the cryptocurrency will be abused by criminals and negatively impact the US dollar. The social network said it won’t launch the cryptocurrency until all the concerns lawmakers have are addressed.

Facebook plans to launch Libra in the first half of 2020 and has created a new group called the Libra Association to govern the cryptocurrency. Libra will be pegged to a basket of assets so its value won’t swing wildly like other cryptocurrencies. Facebook’s executives say sending money across borders could be cheaper using Libra than conventional banks, expanding people’s access to financial services, especially in developing countries.

The EU is concerned that Libra could create “possible competition restrictions” on data that will be shared and the use of consumer information, Bloomberg reported. The investigation focuses on the governance and members of the Libra Association. But regulators are also looking into how Libra-backed apps will be integrated into Facebook’s messaging services, including Messenger and WhatsApp.

Facebook and the European Commission declined to comment. The social media company isn’t the only tech giant facing scrutiny from antitrust regulators in Europe. Last month, EU regulators announced they were investigating whether Amazon ran afoul of the EU’s competition rules with its use of data from independent retailers.

Source: CNet

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