Facebook users warned think carefully before signing up to the site’s cryptocurrency

Facebook is rolling out digital currency but users should consider carefully the implications of signing up.

Facebook users have been warned to “think twice” before delving into the social media juggernaut’s cryptocurrency offering and sharing their private banking information.

Already known for disregarding users’ private details, the behemoth this week revealed it will launch a cryptocurrency allowing people to use via chat apps Facebook Messenger and WhatsApp.

This move is Facebook’s attempt to become more than just a social media site and tap into becoming a bank for its users.

Planned for rollout in 2020 the currency, named Libra, will be an intermediary for dealing with traditional currencies.

But the University of Melbourne Associate Professor of Computing and Information Systems,

Vanessa Teague, warned those considering using it to be extremely careful.

“In some ways a cryptocurrency run by Facebook has all the possible risks of a cryptocurrency plus all the possible risks of using Facebook combined,” she said.

Facebook ‘too slow’ to act on ‘threats’

Murdoch: ‘Tech giants should face more scrutiny’

Facebook CEO Mark Zuckerberg has come under fire in recent times for his site’s handling of the personal information of users. Picture: AFP

“We’ve seen Facebook used for all kinds of manipulation, not just financial and economic manipulation such as getting you to buy stuff and political manipulation.

“Financial information is just going to add to that.”

There are also concerns those signing up to the digital currency would have to hand over personal identification documents such as a licence or passport.

There are plenty of heavy hitters supporting Libra — including 27 multinational companies such as MasterCard, Visa, Uber, Paypal, Spotify and Vodafone.

Facebook will have its own Calibra wallet which will allow users to make purchases and send money to people with almost no fees.

But the nation’s data protection authority — the Office of the Australian Information Commissioner — said they had issues about Facebook’s security measures with the cryptocurrency.

“We are asking Facebook for more information about how it will protect Australians’ personal information in delivering this product and how they have assessed the risks,” she said.

The nation’s data protection authority said it had issues about Facebook’s security measures with the cryptocurrency Libra. Picture: AFP

She also said organisations taking personal data must meet their “legal obligations and the community’s expectations that their personal information will be handled responsibly.”

Assoc Prof Teague warned users to the site’s cryptocurrency to open up their eyes because they would “know your financial transactions and what they mean about you.”

“It’s a phenomenal amount of information, even more than just ordinary communication on Facebook,” she said.

“Now you might be telling Facebook when you make a political donation, when you buy pharmaceuticals and a lot about your financial situation and how much you buy.”

Financial comparison website Finder’s co-founder Fred Schebesta likened it to the “first hotmail of cryptocurrency”.

“The transactions work like Bitcoin, except they’re built in their own language and own coin and it’s stable in price,” he said.

“You’ll just be able to connect your debit card or credit card and buy the coins and send them to each other.”

@sophieelsworth

UNDERSTANDING CRYPTOCURRENCY

Cryptocurrency

A digital or virtual currency which is a form of electronic money. It doesn’t exist in a physical form.

Blockchain

A digital system which records transactions made in cryptocurrency that is held on computers.

Libra

This is Facebook’s cryptocurrency that allows users to buy items or send money to others.

Calibra

This is a separate company to Facebook that will handle crypto dealings and help protect users’ privacy rights.