Facebook has received strong criticism for its attempt at launchign its cryptocurrency libra, and its track record with securing user data is not helping the situation.
Facebook Messaging App Flaw
In early 2018, the social media platform became infamous for the Cambridge Analytica scandal that saw millions of users have their profiles mined for political advertising. While that event shook the foundation of social media, a new design flaw in a Facebook product is casting serious doubt over the company’s ability to produce its future cryptocurrency.
According to a report by The Verge, Facebook’s Messenger Kids app has been affected by a bug that allows strangers to talk to children using the service. Messenger Kids was originally designed as a safeguard for parents worried that their children would engage online with anonymous strangers.
However, following the bug’s discovery, the social media giant has been forced to close group chats and alert users to the breach in privacy, despite yet making a public statement over the issue.
The Verge published a copy of the alert, which states,
Hi [PARENT], We found a technical error that allowed [CHILD]’s friend [FRIEND] to create a group chat with [CHILD] and one or more of [FRIEND]’s parent-approved friends. We want you to know that we’ve turned off this group chat and are making sure that group chats like this won’t be allowed in the future. If you have questions about Messenger Kids and online safety, please visit our Help Center and Messenger Kids parental controls. We’d also appreciate your feedback.
Facebook confirmed that the error message has been issued to thousands of users over the last week, stemming from a bug in the messaging app’s permissions when applied to group chats. The error has resulted in thousands of children being exposed to conversations with unauthorized users, which completely negates the purpose of the service.
— The Verge (@verge) July 22, 2019
A Facebook representative commented,
“We recently notified some parents of Messenger Kids account users about a technical error that we detected affecting a small number of group chats. We turned off the affected chats and provided parents with additional resources on Messenger Kids and online safety.”
Bitcoin Compared to Libra
While messaging may be a different sphere from payments, the most recent scandal for Facebook adds to the growing list of concerns over the company’s ability to secure a cryptocurrency.
In comparison, bitcoin has proven itself to be a secure, permissionless system that has been difficult, if not impossible, for traditional financial systems to replicate. With a market cap of $175 billion on the line, bitcoin has provided all of the incentive hackers need to crack the system open.
Facebook, on the other hand, has a spotty record at best in securing user data and protecting its consumers. The social media platform has failed to prevent meddling in national political campaigns, allowed strangers to talk to children through their messaging app and has been targeted by regulators as a potential monopoly.
Already the company has dropped the ball with libra in announcing Swiss agency FDPIC to oversee user data protection–despite the latter having never been contacted by Facebook.
Facebook’s lack of accountability begs the question: with all of its previous failings, should the social media platform be trusted to produce a digital currency? Fans of bitcoin may not care either way. They will continue using BTC whether libra is a success or a total bust.
But it may paint a specific picture to the “outside world.” Most mainstream audiences will conflate libra with cryptocurrency, and may even view the digital currency as ‘Facebook’s bitcoin.’ Many analysts have predicted that libra will be less a ‘bitcoin-killer,’ than a signal fire to draw interest to the industry of crypto. However, the total failure of libra could inadvertently backfire on bitcoin–or it could prove that open source cryptocurrencies are the only viable alternative.
It’s hard for any proponent of decentralization to support increased government regulation on Facebook. However, given the historical record and overwhelming distrust of Facebook, it’s difficult to imagine users will feel comfortable using the social media platform for payments.