“We are joining together to express our shared concerns about the privacy risks posed by the Libra digital currency and infrastructure,” reads the joint statement (see below) issued by the privacy commissioners of the US, the UK, the EU, Australia, Canada, Albania, and Burkina Faso on August 5.
The statement says that these privacy risks go beyond just financial privacy due to Facebook’s “expansive categories of data collection on hundreds of millions of users”. The joint statement adds that while Facebook and Calibra have made “broad” statements about privacy, they have failed to specifically address the information handling practices that will be in place to secure and protect personal information. Calibra’s blog post says that user data might be shared in “limited cases”, but doesn’t specify those cases.
The commissioners have asked Facebook a set of questions around their data protection plans for Libra; some of the most important ones are:
- How can global data protection and privacy enforcement authorities be confident that the Libra Network has robust measures to protect the personal information of network users?
- How will the Libra Association ensure that all processors of data within the Libra Network are identified, and are compliant with their respective data protection obligations?
- Where data is shared amongst Libra Network members:
- what data elements will be involved?
- to what extent will it be de-identified, and what method will be used to achieve de-identification?
- how will Libra Network ensure that data is not re-identified, including by use of enforceable contractual commitments with those with whom data is shared?
Growing scepticism against Libra
This joint statement by privacy commissioners seeking details of Libra and Facebook’s privacy protection measures adds to the chorus of growing scepticism against the cryptocurrency:
- In July 2019, a group of Senators in the US raised their concerns against Libra, noting that it would be “crazy to give them [Facebook] a chance to experiment with people’s bank accounts”.
- US President Donald Trump tweeted on July 12 that Libra would have little standing or dependability. Calling for regulating Libra by US regulators, he wrote that “if Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations”.
- On July 7, Benoit Coeure, executive board member of the European Central Bank, said that regulators must act quickly to prepare for the entry of US tech giants such as Facebook into the financial system. He said it was “out of the question to allow them to develop in a regulatory void for their financial service activities, because it’s just too dangerous”, and that “we have to move more quickly than we’ve been able to do up until now”.
- When Facebook unveiled its plans for Libra on June 18, reactions critical of the movie poured in: “Facebook’s Libra isn’t a pure cryptocurrency”, “nobody should expect privacy by using it”, and “[Libra is a] catastrophic regression”. Some people also highlighted the threat that Libra poses to governments and the global financial ecosystem.