(Bloomberg) -- Facebook Inc. Chief Executive Officer Mark Zuckerberg put on his game face Wednesday to convince a skeptical Congress that his company’s ambitious plans for a cryptocurrency will benefit millions of poor and underbanked people around the world, and that the technology behind it should be developed by an American firm or risk being one-upped by China, which doesn’t share the same values as the U.S.
The 35-year-old executive is expected to face hours of questioning starting at 10 a.m. by the House Financial Services Committee on plans for Facebook’s Libra cryptocurrency as well as a wide-range of topics posed by Congressional representatives. Zuckerberg is well aware of the skepticism the cryptocurrency plan faces, not least because of the missteps his own company has made regarding protecting data privacy.
“I believe this is something that needs to get built, but I understand we’re not the ideal messenger right now,” Zuckerberg said in prepared remarks. “We’ve faced a lot of issues over the past few years, and I’m sure people wish it was anyone but Facebook putting this idea forward.”
Facebook’s Libra project has faced a barrage of criticism since it was announced in June. Government officials and central bankers in the U.S. and Europe have raised concerns about how the project would protect users’ privacy and prevent criminals from using it to launder money. Zuckerberg says he has no intention of launching the cryptocurrency without approval from regulators. David Marcus, who is leading Facebook’s Libra efforts, testified to the same committee in July in an effort to assuage some lawmaker’s concerns.
While Zuckerberg has been leading a charm offensive in the capital recently, his appearance before lawmakers was a highly anticipated event and prompted the usual media circus. The hearing room opened at 9:30 a.m. in Washington but journalists were already lining up two hours earlier for very limited seating. A line for the public included “line holders,” saving spots for executives from Facebook and the Libra Association.
Zuckerberg comes prepared with lofty arguments about Libra’s purpose: It would help reduce income inequality by giving people -- including 14 million in the U.S. without access to bank accounts -- an easier, faster and cheaper way to send money around the world. At the same time, it would secure America’s international financial leadership, since Libra would be backed mostly by the U.S. dollar, especially if the cryptocurrency is allowed to launch prior to similar planned efforts in China.
But congress, led by Representative Maxine Waters, a Democrat from California who heads the Financial Services Committee, is set to be tough on Zuckerberg. For years he said his social network’s purpose was to “connect the world,” but that mission ended up as a grow-at-all-costs strategy pursued with blind spots around the harmful ways people were using the product. Zuckerberg last testified to congress in April 2018, answering 10 hours of questions about how Facebook allowed app developers to collect data on users, and how the platform was used by Russia to influence the 2016 presidential election.
Goals for the democratization of money aside, Facebook envisions Libra being incorporated into the company’s various messaging apps including WhatsApp and Facebook Messenger. The company believes that the currency could help benefit its existing advertising business, or create opportunity for new revenue streams.
Zuckerberg, in his second congressional appearance since April 2018, could also face questions from the 60 members of the committee on a wide range of issues. There will also probably be questions about Facebook’s targeted ad business, since the company has been accused of letting advertisers discriminate with their ads on the network. There will also likely be questions about privacy, a perennial concern in Washington, as well as political bias and election integrity.
The hearing will allow each of the committee’s 60 listed members 5 minutes to speak or ask questions on top of opening statements and breaks. Assuming most of them show up to take advantage of their allotted time, that means the hearing could last well over five hours.
