Facebook has been on a crusade to try and prove to the world, and especially the USA, that it is competent enough to launch its own stablecoin cryptocurrency, Libra. Privacy scandals and data hacks have led many to think the social media giant is not up to the task – and then it had its payroll hard drives stolen.
It was reported by Bloomberg that personal banking information for tens of thousands of Facebook employees was compromised when a thief stole hard drives out of a car. The data was not encrypted and contained sensitive information such as bank account numbers and the last four digits of social security numbers.
Of course, this is not a good look for Facebook in the face of its urge to prove itself as secure and stable enough to run the finances of over 2.1 billion people who operate its platforms (including Whatsapp and Instagram). More so, the company is also failing to prove its belief in blockchain in cryptocurrency by not storing such important data on with the technology, or even indeed paying wages with digital assets.
Can Facebook Be Trusted?
The Cambridge Analytical scandal and Facebook’s role in it has been well-publicized and documented. In fact, it is arguable that the scenario opened many social media users’ eyes to the importance of data protection.
Facebook faced the music in the Senate on that, and certainly damaged their reputation. Its work towards Libra has been hampered by the scandal, especially when hauled in front of the Senate recently to answer questions on the cryptocurrency, as BeInCrypto has previously reported on.
More so, Facebook was also fined $5 billion not too long ago by the Federal Trade Commission (FTC), while earlier this month, the FTC said it was seeking an injunction against Facebook to stop the social platform from merging with Instagram and WhatsApp on antitrust grounds.
So, while Facebook’s drive towards Libra is heralded as a big step in innovation, and a potential watershed moment for cryptocurrency, perhaps the US and other skeptical regulators are right. If Facebook is still making basic errors in the protection of data – financial data as a coincidence – it may not be the right company to launch a project like Libra.
Why Not Fully Embrace Crypto and Blockchain?
On a broader level, this kind of primitive and foolish compromising of data gives cadence to how blockchain can be a useful tool for the protection and immutability of sensitive data. Facebook is promoting blockchain technology, as well as cryptocurrency, but back at HQ, it is not implementing what it is developing.
Had Facebook been experimenting with the protection of its own data on the blockchain, this uneasy compromise of their payroll probably would not have happened, and more so, they would have a better understanding and footing to state their case for Libra.
On an even grander scale, if Facebook were so vested in cryptocurrency, and were paying employees in a Libra-like coin internally, this again probably would not have happened, and they could have proven their credentials in the space of digital asset management.