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Bitcoin Slumps as Backlash Against Libra Begins

© Reuters.
© Reuters. – slumped on Friday in Asia following reports that the U.S. House of Representatives Committee on Financial Services requested that Facebook (NASDAQ:) stop developing its cryptocurrency, Libra.

In a letter sent on Tuesday, the committee said the project could lead ”to an entirely new global financial system that is based out of Switzerland and intended to rival U.S. monetary policy and the dollar.”

“This raises serious privacy, trading, national security, and monetary policy concerns for not only Facebook’s over 2 billion users, but also for investors, consumers, and the broader global economy,” the lawmakers said.

Bitcoin prices slumped 6.3% to $11,160.8 by 11:39 PM ET (03:39 GMT).

The House Committee on Financial Services is not the only body sounding the alarm about Facebook’s plans. A group of thirty-three advocacy groups have also penned a letter calling for a moratorium on Libra development.

Prices of other major cryptocurrencies also fell. was down 3.8% to $285.94. was down 4.4% at $0.38436.

slipped 0.1% to 119.596.

In other news, Britain’s Financial Conduct Authority (FCA) said crypto-related derivatives including options, futures and CFDs are too risky for small-sized investors.

The Authority is now considering a ban on such products, The Guardian report.

“Most consumers cannot reliably value derivatives based on unregulated crypto-assets. Prices are extremely volatile and as we have seen globally, financial crime in crypto-asset markets can lead to sudden and unexpected losses,” said Christopher Woolard, executive director of strategy and competition at the FCA.

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