U.S. President Donald Trump on Thursday criticized Bitcoin, Facebook’s proposed Libra digital coin and other cryptocurrencies added that companies should make themselves subject to U.S. and global regulations if they wanted to “become a bank.”
“Facebook Libra’s ‘virtual currency' will have little standing or dependability. If Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks,” Trump said in a series of posts on Twitter.
“I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air,” Trump wrote. “Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity.”
Facebook last month unveiled plans to launch its global cryptocurrency in 2020. Facebook and 28 partners, including Mastercard, PayPal and Uber Technologies would form the Libra Association to govern the new coin. No banks are currently part of the group.
JPMorgan Chase & Co, the largest U.S. bank by assets, plans to launch its own digital coins.
Federal Reserve Chairman Jerome Powell had previously told lawmakers that Facebook’s plan to build a digital currency called Libra could not move forward unless it addressed concerns over privacy, money laundering, consumer protection and financial stability.
Facebook has said repeatedly that it plans to work with regulators to get Libra off the ground, and David Marcus, the Facebook executive who has spearheaded the Libra effort, will testify before multiple congressional committees next week.
Facebook's virtual coin will be built on a new Blockchain infrastructure accessible from anywhere in the world. Facebook and its partners on the project have set up a non-profit organization in Switzerland to govern the payment network and will hold a reserve of bank deposits and short-term government securities that will back the coin.