Switzerland awaits details on Facebook's crypto plan

Facebook Inc’s Libra cryptocurrency project has not responded to an information request by Switzerland’s data privacy watchdog, the authority said on Tuesday, noting it wants more details to help define its oversight role over the US social media company’s proposed digital currency.

Facebook in mid-June announced plans to launch Libra next year as it expands to e-commerce and digital payments. Since then, it has faced scrutiny by politicians, regulators and central bankers around the globe, including over fear that widespread adoption by Facebook’s 2.38 billion users could disrupt the financial system and facilitate money laundering.

David Marcus, who oversees Facebook’s currency project, said at a US Senate hearing earlier this month he expected the Swiss Federal Data Protection and Information Commissioner (FDPIC) to be Libra’s privacy regulator. This is because the nonprofit Libra Association, which Facebook had set up to oversee the currency, is based in Geneva.

In a statement, the FDPIC said it sent a letter to the association on July 17 because it had not yet heard from the group about the project.

Facebook did not immediately respond to a request for comment.

Among other things, the Swiss data privacy authority said it was expecting Libra to conduct an impact assessment of data protection risks associated with the cryptocurrency, evaluate risks and propose measures to minimize them.

“The FDPIC stated in its letter that as it had not received any indication on what personal data may be processed, the Libra Association should inform it of the current status of the project so that the FDPIC could assess the extent to which its advisory competences and supervisory powers would apply,” the watchdog said.

“The FDPIC is currently waiting for the Libra Association to respond to (its) letter of 17 July 2019 and set out their official position.”

Marcus had told the US Senate that the association has held talks with the Swiss Financial Markets Supervisory Authority on “an appropriate regulatory framework.”

Facebook’s handling of data privacy has been the focus of criticism, and the US Federal Trade Commission is set to announce the company’s sweeping settlement of allegations it mishandled user privacy and would pay USD 5 billion, two people briefed on the matter told Reuters on Tuesday.