House Democrat: Facebook cryptocurrency could be more dangerous than Osama bin Laden

House Democrat: Facebook cryptocurrency could be more dangerous than Osama bin Laden
© Greg Nash

Rep. Brad ShermanBradley (Brad) James ShermanTrump impeachment efforts will haunt the next Democrat in the White House Pelosi announces launch of formal impeachment inquiry into Trump House Democrats blur lines on support for impeachment MORE (D-Calif.) on Wednesday argued that Facebook's new cryptocurrency project could be a greater threat to Americans than Osama bin Laden.

Speaking during a House hearing on the digital currency, Sherman said Facebook CEO Mark ZuckerbergMark Elliot ZuckerbergWarren targets Facebook with ad claiming Zuckerberg supports Trump Key Democrat presses FTC over Facebook settlement's 'dangerous precedent' On The Money: Fed officials saw rising risk of recession | Ocasio-Cortez, Cruz blast NBA for 'outrageous' response to China | Prospects dim for trade breakthrough with China MORE should testify before Congress about his company's plans.

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"We’re told by some that innovation is always good," Sherman said. "The most innovative thing that happened this century is when Osama bin Laden got the innovative idea of flying two airplanes into towers."

"That’s the most consequential innovation," he said. "Although this may do more to endanger America than even that."

Bin Laden, the founder of al Qaeda and a key figure in the 9/11 terrorist attacks, was killed in Pakistan by a U.S. military operations unit in 2011.

Sherman went to refer to Facebook's cryptocurrency, known as the Libra, as the "Zuck Puck" and "Zuckerberg’s baby."

The California Democrat has railed against cryptocurrencies before. Earlier this year he called for a total ban on the digital payments, arguing they could diminish U.S. financial power.

He raised similar concerns Wednesday over the Libra, warning that it could be a "godsend to drug dealers" and those who want to use it for "other nefarious purposes."

David Marcus, the head of Facebook subsidiary Calibra – which will lead Facebook's contributions to the Libra project – pledged at the hearing that his team will have experts dedicated to ensuring Facebook's wallet complies with anti money-laundering and "know your customer" standards. "Know your customer" requires businesses to verify the identity of the people it works with in order to get ahead of potentially illicit behavior.

Sherman predicted that Calibra will not adhere to those promises. He raised concerns that the cryptocurrency could be used to finance terrorism and sidestep U.S. laws.

"Someone with an understanding of the politics of this country needs to explain to Zuckerberg that if cryptocurrency is used to finance the next terrorist attacks against Americans, a hundred lawyers ... are not going to protect his rear end from the wrath of the American people," Sherman said.

"This is an attempt to transfer enormous power from America to Facebook and a number of its allies," he added. "We need Zuckerberg here." 

Facebook's plans to launch a new cryptocurrency have been met with aggressive pushback from federal regulators and Capitol Hill. Many Democrats have already called for the company to halt its plans entirely.