A news report by the Washington Post published July 22 has revealed that a slew of fake social media accounts, pages, and groups have been posing as official Libra hubs. These hubs even claimed to already be selling Facebook’s controversial Libra tokens at a significant discount.
Since the report went viral, Facebook proceeded to close multiple accounts across its own platform and Instagram on grounds of their involvement in fraudulent activity and impersonation.
Fake Libra Hubs Spread Across Facebook
According to the report, most hubs offered to sell users Libra only through third-party websites. The vast majority of them even used Facebook’s logo, official Libra imagery and even pictures of Facebook CEO, Mark Zuckerberg, to deceive people into thinking that they were official Libra outlets. This onslaught of scam accounts could further increase distrust in Facebook’s cryptocurrency, which is already facing a lot of heat from regulators around the world.
Eswar Prasad, an economics professor at Cornell University, pointed out the irony of Facebook’s own social media platform being used to undermine the trust of its upcoming cryptocurrency. On the other hand, Democrat senator Mark Warner said that this is another reason why Facebook should be more cautious in its approach towards Libra and not proceed to launch anything until American regulators are completely satisfied.
In response to these reports, a Facebook spokesperson said,
“Facebook removes ads and pages that violate our policies when we become aware of them, and we are constantly working to improve detection of scams on our platforms.”
Vulnerable to Costly Disinformation
Facebook’s Libra could become a victim of fake news and disinformation, that has affected other cryptocurrencies like Bitcoin in the past. Similar to Twitter accounts impersonating famous personalities like Vitalik Buterin, these accounts were likely attempting to cash in on the excitement surrounding Libra’s announcement. One page owner, Trent Partridge, told the Washington Post that he created the page ‘Calibra Digital Wallet’ to capitalize on the excitement surrounding the currency’s imminent launch.
Svitlana Volkova, a scientist at Pacific Northwest National Laboratory, agreed that cryptocurrencies are among the most effective ways to spread disinformation, saying that similar to political sway, such acts too can have a large, real-life impact. He added that Facebook should leverage its content moderation and AI investments to detect and remove such malicious activity on its platform.
Facebook’s Libra cryptocurrency was announced last month as a stable coin pegged to the US dollar. The social media company claimed that Libra would allow people to send money or buy things without going through a traditional bank or credit card company. Since its announcement, however, the digital asset has been mired in scrutiny and has received bipartisan criticism from the senate. Financial regulators around the world, meanwhile, have suggested that stricter regulation be introduced in the interest of consumers.
Do you think that Facebook will be able to launch its Libra digital currency as planned a year from now? Let us know your thoughts in the comments below.