The cry of ‘not on my watch’ that greeted Facebook’s announcement that it was entering the currency market was both loud and uncompromising. So resounding, in fact, that it brought together people who would have, under other circumstances, made for an unlikely alliance - President Trump, the Democrat-controlled House Financial Services Committee, Mark Carney, Christine Lagarde, the EU, and the finance ministers of numerous countries around the world – all resolutely giving Libra two thumbs down.
The congressional hearings at which Representatives interrogated Facebook can be usefully summed up as their asking; which bit of your disastrous record on accountability, governance and moral virtue makes you think you are fit to enter the sacrosanct world of finance? After a testy six hours the conclusion appears to be that Facebook is simply not fit to manage people’s money, let alone an entire currency.
The problem is not cryptocurrency per se. Cryptocurrency is nothing new – it already operates on the fringes of the financial system, tolerated even if not loved.
The real problem is data.
In an age when data is arguably more powerful than money, Facebook has 2.4 billion users, each with 52,000 data points, held in 15 million square feet of server farms, across dozens of interconnected platforms, apps, and services. They own a level of intimate knowledge that can, at the flick of an algorithm,change outcomes for a person, business, sector, or an entire nation state. With control of a currency, Facebook would have another vast, incredibly powerful data-set that could, as critics point out, be used for illicit activities and laundering, or to skip financial controls and regulations. It has even been suggested that Libra is a way of getting poor folk to lend Facebook money at 0% interest. Whichever one is true (it could be all), for power to be so concentrated, so opaque, so unaccountable is not in the best interests of anybody – expect perhaps Facebook.
Congress is quite rightly alarmed at the potential implications of Libra, but that power already exists and impacts on us all - as we increasingly live under a regime of vast data surveillance, the value of which vastly outstrips most traditional assets. This power is most indefensibly leveraged on the third of internet users that are children, impacting on almost every area of a child’s daily experience.
In an integrated and interdependent world, the way a child is treated in the digital environment affects the whole of their childhood. The intimate knowledge gathered about them can be used to simultaneously predict, manipulate and determine their reputation, behaviour, opinions, and emotions for the rest of their lives. Recommendation algorithms, loot-boxes, social validation loops of likes and streaks, endless nudges and notifications – these are the tools with which children are controlled by the online services they use. Or rather, the services that spend hundreds of millions making sure they feel compelled to use.
We are horrified at the prospect of Facebook controlling a currency, why so caviller about Facebook controlling childhood?
Exchanging data that indicates sexuality, mood, exact location, contacts, spending, heartbeat, menstrual cycle or social status for free access to services might be an acceptable free market approach for adults, but it is hardly an exchange that an 8, 10, 13 or even 17-year-old should be asked to make. Yet they are - in every one of their tens of thousands of daily interactions.
The fierce reaction to Facebook’s Libra, whilst completely correct, is disheartening in the extreme. We are prepared to protect the financial system with regulatory and institutional weaponry at the ready. But not so childhood. When the Information Commissioner announced her “kids’ code” to protect children’s data, and the tech sector squealed – there was a resounding silence. Even from the UK’s media who fell-in behind the tech sector by prioritising loss of ad revenue (disputable) over childhood.
It seems that when it comes to the kids it is okay for them to be collateral damage to a business model that shamelessly commoditises their every thought, feeling and movement – so it can sell something to someone somewhere at some time, now or in the future. Ultimately, however, it is childhood that they are selling – and they’re selling it short.
Baroness Beeban Kidron is Chair of 5Rights Foundation