A bill has been circulated for discussion by the Democratic majority which leads the House Financial Services Committee to propose barring big technology companies from offering financial services. If it ends up becoming law, major tech companies would not be able to act as financial institutions or issue their own digital currencies.
It’s no surprise that this bill has been proposed after Facebook unveiled its Libra digital coin which has received widespread objection in Washington. This sweeping proposal would impose a fine of $1 million per day for tech companies that violate these rules.
The “Keep Big Tech Out Of Finance Act” draft legislation describes a large technology company as one that primarily has an online platform with at least $25 billion in annual revenue. “A large platform utility may not establish, maintain, or operate a digital asset that is intended to be widely used as medium of exchange, unit of account, store of value, or any other similar function, as defined by the Board of Governors of the Federal Reserve System,” it reads.
Facebook would most certainly qualify as a big tech company under this bill. The company has said that it’s looking to launch the Libra global cryptocurrency in 2020. It remains to be seen, though, if the bill receives enough votes to pass the lower chamber. Even if it does that, it may face an uphill battle in getting passed through the senate.