(Bloomberg) -- Federal Reserve Chairman Jerome Powell’s shrug could be heard all the way to Silicon Valley.
Like everybody else in government, the U.S. central bank chief is unsure how regulators will handle Facebook Inc (NASDAQ:FB).’s plan for a digital currency called Libra. He made that clear at a Senate hearing Thursday where he reiterated concerns about the cryptocurrency’s potential for fomenting money laundering and financial instability problems. And he expressed specific worries over customers’ privacy.
“There isn’t any one agency that can stand up and have oversight over this,” Powell told members of the Senate Banking Committee. “The privacy rules that we apply to banks, we have no authority to apply them to Facebook or to Libra.”
Powell told committee Chairman Mike Crapo of Idaho that the government might need to create a new regulator to address the problem.
“It isn’t obvious at all in our current regulatory system that we have in place what we need,” he said.
However it’s handled, Powell said he doubts all of the questions surrounding the proposal can be addressed and resolved on the timetable that Facebook laid out for launching Libra by next year, warning against “a sprint to implementation.”
On Wednesday, Powell told lawmakers at a House Financial Services Committee hearing in Washington that the various concerns about Libra, from privacy to financial stability, “should be thoroughly and publicly addressed before proceeding.”