During day two of the Libra hearing of Warren Davidson, Member of the House of Representatives, called the libra coin a shitcoin. The reason? The currency is not as decentralized as bitcoin. His colleague Kevin McCarthy said that he likes bitcoin and its decentralized nature.
Libra is not a cryptocurrency
Earlier hearings on cryptocurrency were not nearly as entertaining as the hearing on libra in the past two days. The delegates made a good impression and asked good questions about the digital currency of Facebook, but also about the working of Calibra, the accompanying wallet.
During the question fire, Congressman Warren Davidson demonstrated that he was aware of crypto language. He did that in conversation with Meltem Demirors, CSO of CoinShares.
Davidson said, “Many people in crypto use a sentence that you may know: there is Bitcoin, and there are shitcoins.” Davidson then asked Demirors: “Do you know that sentence and what can people mean by that?”
Demirors said she is familiar with this expression and explained that Bitcoin is decentralized while Libra is “highly centralized.” Demirors also said there is a big distinction: “Libra is not a cryptocurrency.”
Anyone can download the bitcoin software and run a node, while the Libra Association is in a cartel of large, profit-making companies. Demirors compared Libra with an investment fund that offers two types of shares.
Davidson said he was concerned that Libra’s centralized nature is too different from bitcoins decentralized values.
How democratic is the Libra Foundation?
Another highlight of the hearing was when Alexandria Ocasio-Cortez Calibra CEO David Marcus asked: “Were the members of the association democratically elected? Who chose them?”After Marcus explained that membership of the Libra Association was open, Ocasio-Cortez said:
“So we’re talking about a currency that is managed by private companies? Do you believe that the currency is a public good? Do you believe that Libra should be a public good? ”
I love bitcoin
Republican Kevin McCarthy told reporters that he likes the decentralized aspect of bitcoin, but is skeptical about libra.
“I want to see more decentralization because with libra it worries me that Facebook will manage the market,” he told CNBC.