If Facebook attempts to become a money transfer service or bank without the required licensing, they will have their offices raided and their doors locked on them. This is something Governments don't tend to mess around with.
Municipal regulations. Not federal and state laws with criminal penalties.
Wilfully breaching AML statute is arson to Uber’s parking tickets.
I'm sure Facebook would not be dumb enough to step in front of that train, but if they did, it would run them flat.
There's also a sort of 9/11 effect going on here. The reason the 9/11 hijackers pulled it off was that nobody expected them to use the planes as giant suicide bombs. Previous hijackings generally ended peacefully, so everybody just stayed chill. But that window of opportunity expired before they managed to crash the 4th plane. Now nobody's just going to sit quietly through a hijacking.
Similarly, I think the reason Uber and Airbnb got away with so much lawbreaking is that it was novel to have nominally respectable companies blatantly committing a wide variety of crimes. But these days, tech companies get a lot of suspicion. Regulators are not interesting in getting caught flat-footed again. And that was true 5 years ago; SF vigorously shut down a bunch of entrepreneurs that wanted to sell public parking spaces back to the public: https://www.govtech.com/transportation/SF-Demands-MonkeyPark...
Plus, taxi and hotel regulations are a very different situation than laws intended to prevent international money laundering, tax evasion, sanction breaking, or black market economies.
New York City shutting down Airbnb doesn't shut them down in the thousands of other cities they're active in. If Boise Idaho restricts Uber, that doesn't suddenly restrict them in Chicago.
The US Government has an entirely different kind of power and when it comes to protecting the global reserve currency, the one guarantee is that they will use it.
It sure would be a shame if FBI directors in charge of such an investigation were cheating on their wives or were illegally getting kickbacks from contractors. Would be absolutely inconceivable that Facebook might even leak that information to their friends at the CIA or NSA and call in a favor.
But sure, if libra is just an altcoin on unrelated hardware then fb won’t be affected.
> But sure, if libra is just an altcoin on unrelated hardware then fb won’t be affected.
A company as large as fb has the means to segregate application hardware. Hell, even smaller companies do this for liability reasons. If fb didn't it would be pretty lazy and ill conceived.
Facebook is dealing with different powers here.
But FB must be spending a lot on lobbying, and that should help them avoid any major surprises regarding enforcement actions.
That only helps them in countries like the US where bribery is legal.
On paper, by insistence of the regulators, as a condition of acquiring it, there is a limit on their relationships with Instagram too...
I guess they could go for the remittances market, but that's really not where I see Facebook wanting to go.
The same might happen with money transfers, if Messenger becomes another WeChat, just outside of China.
From the legal perspective, could Facebook be like Coinbase, but with a single currency?
Are you able to provide references supporting your claim?
Edit: oddly enough, that hit wasn't the one where I read about it last week... But any page with sources works I suppose.
How does that support your claim?
Here is a picture, convince yourself: https://www.messengerpeople.com/wp-content/uploads/2019/07/w...
There is north america, a few african countries, france and a few eastern European countries and australia. The rest is practically WhatsApp except for china which is WeChat.
WhatsApp and Instagram have huge popularity outside of North America
I’ve used WhatsApp since before FB acquired them but this is sounding like it’s going to get turned into a clusterfuck of stuff I have no interest in.
Is it easy for an individual to set up like, a program to automatically do money transfers that way, in a for-profit way?
Because if so, that's pretty cool.
I mean, I understand that most people don't particularly want to do that, but I still think it could be cool to have it as an option.
US don't have sepa or psd-2
The UK financial regulators are not dumb and have thought this through.
[1] Specifically here are details of the emoney regulations if you're interested https://www.fca.org.uk/firms/electronic-money-payment-instit...
The UK financial regulators have already given the Electronic Money license to at least three crypto companies[1].
[1] https://cointelegraph.com/news/uk-watchdog-grants-third-e-mo...
Facebook may have an advantage on KYC as it already knows it's clients through their facebook activity and so may be able to get the costs lower which could be a competitive advantage there.
What Facebook might know about someone is completely worthless when it comes to KYC. In the country I live there are even some government issued identity documents that won't cut it.
(by message I mean the internet has foiled politicians pretty much using "trusted" organizations as mouth pieces and revealed many for who they are and also prevented scandals and whistle blower stories from being buried or turned)
1. Same has been said of Bitcoin, and yet the government kinda embraced it.
2. Facebook is not making Libra. It is a non-profit based in Switzerland.
3. Libra is backed by USD-EUR-JPY and the related countries might turn a blind eye because of that.
edit: nice try Satoshi!
- Shut down all bitcoin exchanges hosted in the United States
- Make it illegal for banks, credit unions, and other commercial financial institutions to allow their clients to make transactions with a crypto exchange (regardless of the countries where the exchange is hosted), or a blockchain
The point is the government can severely hurt Bitcoin adoption by making it illegal, but it cannot completely shut it down.
1. Gov didn't embrace bitcoin, they regulated it. The exchanges have to do KYC and AML monitoring and report activity.
2. If you think FB doesn't 100% control it, I have a bridge to sell you.
3. This doesn't really mean much at the end of the day. It's a tactical decision with low impact on regulations.
What you're failing to appreciate is how important it is for governments to control their financial operations. They don't make it hard just to make it hard. They make it hard because if they don't criminal activity will flourish.
The thing is, money is an iou from the government. If people start using other ious, the influence and power of the government will fade. Result is that libra will control a country.