Investing.com - Prices of Bitcoin and other major cryptocurrencies slumped on Wednesday in Asia as U.S. legislators slammed Facebook’s plan to launch its own digital coin Libra in the Senate.
Bitcoin plunged 14.9% to $9,379.8 by 11:40 PM ET (03:40 GMT). Ethereum slumped 14.7% to $198.23, while XRP and Litecoin were down 5.4% and 12.7% respectively.
David Marcus, Facebook’s top executive overseeing the proposed Libra project, answered questions from the Senate Banking Committee overnight.
Lawmakers described the company’s proposal as a toddler playing matches who burns the house down and criticised the company for repeatedly violating consumers’ privacy. During the hearing, a U.S. senator said the social media giant was "delusional" to believe people will trust it with their money.
"Facebook (NASDAQ:FB) has demonstrated through scandal after scandal that it doesn't deserve our trust," Democratic senator Sherrod Brown, the ranking member of the Senate Banking Committee, said in his opening remarks. "We'd be crazy to give them a chance to let them experiment with people's bank accounts."
Facebook has been under regulatory siege since it announced plans to launch its own alt coin, and U.S. Treasury Secretary Steve Mnuchin on Monday warned that the company will face much tighter regulatory scrutiny if it ever offers digital financial services, saying that it “must implement the same anti-money-laundering safeguards in countering the financing of terrorism as traditional financial institutions.”
Mnuchin’s comments echoed a tweet from U.S. President Donald Trump who came out last week with an attack on cryptocurrencies in general. In the same thread, he warned that “if Facebook and other companies want to become a bank, they must seek a new banking charter and become subject to all banking regulations”.
Bitcoin climbed to nearly $14,000 in late June after Facebook unveiled its Libra plan, but dipped below the $10,000 as the proposal was openly criticised by multiple parties this month.