Work here. There will be some work at the network level. The architecture of the system itself that supersedes all of the individual work the countries are doing to implement this. And then the members of the associations who are transacting using the Payment System will be responsible themselves for implementing and following those rules. Have a big effort to verify identities and authenticate them. We do this today if someone wants to run political ads or run a large page. I appreciate that but a , is goingth facebook to go in. Your major hack for millions of users that have gone through what assurances will actually be in place to make sure users with the most Sensitive Information in terms of finances, will be protected. Thanks. Erberg the Payment Information that people share is stored separately from other information in our services and all of our information is stored securely. This is especially secure. I do not think we have had an issue with this today. We do take payments for a number of things, ranging from fundraisers to people buying ads. We have a secure here in our data center focus on data prevention. In a payment area. One of the issues im concerned about is are we going to be able to use it to buy anything legal in this country . Would you support that . The intent would be to have give people as much control is what they want to do as possible. There are certain types of good better regulated. Then there are certain content policies. Screen much further down downstream and where we are now. To create a system that works and get the appropriate regulatory the committee will tacess fo recess. We have been listening to Mark Zuckerberg, the ceo of facebook. The for theom over House Financial Services committee. He was asked about the cryptocurrency libre and exactly what is involved with that. He said facebook will not go forward unless they get fromatory approval regulators. This is something facebook was a bitcoin with lawmakers about before. There was some suggestion they might go forward anyway. He also said he is talking to regulators from 30 jurisdictions around the world including switzerland to figure how to handle this the best. He was pressed by lawmakers about exactly why we need a new currency and why cant we do this with u. S. Dollars, why do we need need a new currency . Need need a new currency . He emphasized in the United States and around the world, this is something facebook could step into and help with that bank. Is that really why facebook is doing this or is it to make money . Which they have a fair amount already. In lengthy on that to the question of, is this the right time and right message, assuming as aed something cryptocurrency, is this the right way to do it . He admits this is not the perfect time for facebook. Many issues from privacy to issues of political ads, and he admits it is not the perfect time or the perfect messenger. Was pressed on other issues from child pornography and actions done on facebook to issues of to the extent it blitzes thatected due to the u. S. Financial system that isnt undermine want to turn to the chair on the telephone unit an expert on the telephone. What is the cryptocurrency, is it a commodity . What is it . What is it . I recommend we use the term Digital Asset aspect. If we look at libre, there is a questions a question of author offering it to security. If it is being used as a means it looks like a currency and will be treated as such by the , thed states treasury financial crimes enforcement network. They can be regulated as a commodity pool. What were hearing from facebook in the association now is they are looking at this as a means of purchasing goods and services so it looks like a Digital Currency. Lets pick up on that and take mr. Zuckerbergs word. Him he says it should be as easy and secure is using a text message. Sounds like a Money Transfer system. Who regulates that and how . States, youited would have part of the nicest treasury would regulate activities as a Money Exchange or money transmitter. You either have central banking or monetary authorities monitoring as well. What do they require of today . They require a certain balance sheet, the ability to make good on the promise that money will be delivered. Help would be more can to entities are regulated and other firms that transmit funds, paypal, for example. States, thed backbone of the regulations would be having in place policies and procedures to reduce the use of the system for Money Laundering and that would be a key point for libre, the libre Association Going forward. Please stay with us, richard levin. We want to bring in our chief washington correspondent kevin on capitol hill. You listened to two hours of testimony so far. How many surprises from the point of view of people asking the questions have there been . Kevin there have been several surprises, coming at a time when zuckerberg at one point said in explicit terms that he is unsure if libre is actually even going to be successful. I would quickly make three points. Mark zuckerberg greeting a largely bipartisan skeptical of lawmakers who have raised Serious National Security concerns, civil rights concerns, and freedom of speech concerns from various ideological viewpoints. Mark zuckerberg pushback against the notion of Financial Institutions withdrawing their support such as paypal, visa, and mastercard, saying they are not willing to take the market anywhere around the world unless backing of u. S. Regulators. I spoke with a prominent republican on the panel hallway just within the last hour or so who told me that was something many republicans needed to hear. That Mark Zuckerberg was not going to be moving ahead without u. S. Regulatory support. Points to note. Republicans and democrats are very skeptical about how Mark Zuckerberg has handled the litany of questions washed against him and facebook as a whole. The second is this is a very different Mark Zuckerberg that we have seen deal of washington politics over the past year or so. Trying to push out how they deal with regulation, it has been quite a contrast to two the 2016 days of facebook. Please stay with us. Welcome, sarah. Why is it is important for facebook and Mark Zuckerberg . If you take his prepared testimony is a word on this, he does because he wants to improve income inequality and wants to increase america passes financial prominence in the world. We heard hes really doing it because of competitive threats. That will spread to other parts of the world first. How do they make money . Normally they do it off of advertising. Facebook wants to draw more people. Whether that is through the marketplace, selling your couch whether that is through whatsapp, nasty people outside of states, they want to be something you check multiple day for asghout the many minutes as possible. Everything you do to build up to that is the most important. I want to come back to you. You call this a Digital Asset. It would have a value that would go up and down and you can invest in the digital affect, as you call it, and make or lose money and it would be available to the public. To analyzehave whether what libre is doing is security based on what dates to orange groves. One of the biggest problems with the entire Tech Industry is dealing with now is there living when people wait as much as i did in professional football. The technology has advanced and the regulators are having are trying to cram a square peg into a round hole. I do not think there is much hope that congress and the president will agree on how to amend securities and commodities to bring them into the 21st century. With that said, the fcc will look at, is libre being offered to the public in a way to raise capital . It does not appear so. Then the next question is is investmentcollective in order to allow people to have the opportunity to see an appreciation of value based on a bastion of securities, they are not talking about doing anything with securities. There talking about creating one currency backed by a basket of other currencies. I think there is a good argument this is not a security but i think the big issue they will deal with his regulation as a Money Service business. Mark zuckerberg is reentering the hearing room. Coming back in, a lot of photographers are taking pictures. How much farther do we have to go . At least a couple of more hours. I would pick up on something sarah noted which is that this isiance that Mark Zuckerberg trying to get between lawmakers and more urban communities and more Rural Communities, that is a tactic financial communities have tried to use on Financial Regulation trying to build the coalition. I believe we will go back to the hearing because Mark Zuckerberg is behind the microphone. We have the first question. Answers from you earlier. Going through a list of he wanted to know if you would wait for their approval. We went through a whole laundry list of them. Your answer was, for the parts that apply, yes, we will go seek their approval. Other times, you have said we will get their approval. , area facebook standpoint you just willing to seek the approval or will you wait for the approval before anything is launched . It is the latter. Thank you for the opportunity to clarify that. We will not launch anything until we get the approval. If it is ok, i want to take a onent to add some context one of the other questions asked in catching up with my team. As long as it does not take too long. You have 30 seconds. Mark the question before was around whether we implemented changes to ask targeting to make it so people can no longer age, gender, and zip codes in other categories and housing employment and credit opportunity ads. We have implemented the change. The primary surface for buying ads on facebook is part of the agreement in the settlement we agreed to. Thank you for the answer. The reason youre in our committee is we may have issues about the ads you have allowed, where the russians were involved, disinformation. Libree here the cousin of , the Financial Services committee. Mr. Marcus was here to testify and we want to understand what this is. Are you arrency, bank, what is the association . I appreciated those questions we all like innovation but it seems like the innovation will be houston in association in switzerland, not in america. The constitution is the one that starts all of this with article one section 85. Thecountry is given obligation to coin money and regulate the value thereof. Do you consider libre to be money . I consider libre to be a Payment System. There are two ideas that can sometimes be hard to seize out. We certainly do not seek to undercut that. We want to extend American Leadership around the world. You dont consider to be money . I consider it to be a Payment System, an area where it is relatively stagnant. I appreciate that. Im just starting with the constitution, which puts the responsibility on us to coin money. Im trying to figure out, lets isto the next step, which the wallet, which in my opinion is the bank. Is that not right . Sorry, i did not understand. The currency is in the wallet mark yes. It is like me having my money in wells fargo bank. That is the problem. That is what we are facing here. Trying to understand what this thing is that you all are creating. I appreciate creation and would like it to stay in america not go to switzerland. Putting in association together, and as i have been thinking about this, it reminds me of two movies. Doom and the president s analyst. If you want to be talked about to talk about either one, im happy to do it. Everybody had information or the phone company had information on everybody. We need to know what this is. We have to regulate this. I am not sure you guys understand what it is. Thank you. The gentleman from texas is recognized for five minutes. Your biography is a textbook example of capitalism and im a Small Business owner. Im amazed at what you have done. After years of hard work, you onesformed what started out of the largest and most powerful Technology Companies in the world. It does not diminish or you have built. This type of hard work is rewarded. Before i continue, i want to ask you a simple question. I would consider myself a capitalist. Thank you. It is great to hear that. You have received a lot of scrutiny for taking on something as bold as the libre initiative. Drawing the attention of every Bank Regulator the world, i do not think there is anything wrong with asking questions to ensure that product is not used for illegal activity. It still rings true today. Private sector always seems to get it right most of the time. There can undeniably be benefits to bring in this product to market. No matter what policies we enact, the private sector will bring Game Changing technologies into existence. In the Federal Reserve or another federal entity. Not surerberg i am im here to say that others shouldnt try to put their own ideas forward. I just think it is part of the american system, we should encourage more people and even efforts from the government to try new things. This is an area where our system has been stagnant. This ist is the case, an important area. There will always be risks. We need to diligently address those risks. This approach, im not saying is absolutely very best one. I wish other people were trying to do things. That is important for helping to disturb people. It would put a selfimposed handy to handicap on American Companies and entrepreneurship which we talked about make this country great. Compared to counterparts around the world. I think we need to repeat this. What other countries, primarily china, are doing in the Digital Currency space question mark space . Mr. Zuckerberg i think right now, especially in regard to libre, Chinese Companies would be the largely competitors. There is an ongoing Publicprivate Partnership in china where they are very focused on building is an exporting and around the world, and i know there are a lot of that i think are completely valid about how a project like this would impact americas Financial Leadership and our ability to impose sanctions around the world and the oversight on the Financial System in other places. Andink we need to trade off weigh any risks of a new system against what i think are surely risks. If a chinese Financial System becomes the standard. In more countries. Then it would be very difficult. F not impossible youre right to have oversight around the world. That is something i worry about. I appreciate you addressing the issue head on. I will stop there. I want to yield my time back and say im glad you are a capitalist. Thank you for being here. Thank you for being here. I want to take a slightly offtopic today because i sit on the intelligence committee. In order to attack our democracy. Those played on the painful and explosive divisions in society, race, gender, and religion. I will never forget a post in spanish that urged people to vote on the cell phone. I wonder who did. On freedom of expression, i celebrate your commitment to freedom of expression. It also came across as onesided. The importance of black lives matter having a voice. It didnt say anything about Indian Muslims killed because someone used a Facebook Post to organize a mob because the authorities used to organize a mob, my point is what your georgetown speech missed is that all of our rights, freedom of expression is really hard, if it means anything. It means the government will defend the rights of nazis to march through a jewishness that jewish neighborhood. It will defend the right of an american to burn the american flag. With all the anger and emotions that would generate. Just naively say that freedom of expression was a good thing. We invested in those things that will make us worthy to live in the context of freedom of expression. We establish regulation through a democratic and transparent process. He spent a lot of resources to regulate commercial speech and we invest in trillions over the educate americans so when they see something they hate, instead of picking up a gun or knife, they formulate a rebuttal. The town i live in invest half in education. Facebook, and im a customer, today is more like a country in a company. Than like you have global reach. Apparently half of americans get their news from facebook. My question is simple. Inen the investment we made establishing the context for freedom of expression, what commitment will you make, what investment will facebook make . You have almost 50 billion in cash on the books. Investment you are making so this freedom of expression you enabled is a good thing rather than a bad thing, thehe good side overwhelms Indian Muslims and all that can be bad coming out of freedom of expression. Thank you for the opportunity to address this. I talked about a number of risk and i think you are right. When you serve billions of people, even if only one small percentage of them use our services to do harm, i can still be a lot of harm. We have a responsibility to make sure we addressed all of the new threats from the internet as well as existing threats that have been there all along. This is something that, in terms of resources and what were