CNET founder Halsey Minor onstage at the Web Summit tech conference with former professional boxer Wladimir Klitschko and Machine Zone CEO Kristen Dumont.
David Fitzgerald | Sportsfile | Getty Images
LISBON, Portugal — Facebook’s plans to introduce a cryptocurrency show the company is ill-equipped to take on finance, the founder of tech news site CNET has claimed.
“I think it is extraordinary how tone-deaf Facebook is about how and why the financial system works,” Halsey Minor, who founded CNET back in 1994, told CNBC in an interview at the Web Summit technology conference.
Facebook in June first unveiled its planned digital currency, called libra, which was met with a wave of political and regulatory opposition. More recently, key partners in the initiative including Mastercard have backed out amid the backlash it received.
Unlike bitcoin, the world’s most valuable cryptocurrency, libra would work more like a so-called stablecoin, maintaining a firm value to avoid the market volatility seen in other digital assets.
“Nobody wants to hold a currency that is not their own,” Minor said. “There is not one single person out there that is going, ‘give me a new currency’.”
The tech veteran criticized the project further, saying it would put Facebook in the same vein as nations like China, Russia and Iran that are trying to find an alternative to the U.S. dollar and evade sanctions.
Facebook and the Libra Association which runs the project were not immediately available for comment when contacted by CNBC.
The social network has in the past said that it’s speaking with regulators as it looks to build libra. The company also argues that its crypto initiative would not entail the creation of new money, as its token is tied to existing currencies like the dollar.
While Democratic presidential hopeful Elizabeth Warren has been pushing for such a splitting up of tech companies, Minor said he didn’t agree with such a strategy — though he believes such firms are “definitely monopolies.”
“These monopolies are exerting an extraordinary gravitational effect on the economy as a whole,” he told CNBC.
Minor reportedly made $200 million after CNET sold up to CBS Interactive in 2008 for $1.8 billion, but he suffered a setback in 2013 when he was forced to file for bankruptcy.
Speaking candidly about the matter, Minor said he had undergone hardships at the time including divorce and losing his father to suicide.
“From 2006 to 2012 I wasn’t active. I literally disappeared from the world,” said Minor. “In 2012, I was back. Then promptly in 2013, I basically turned over all of my assets to start again.”
The entrepreneur has since pivoted to cryptocurrency, setting up a number of ventures in the space including an exchange called Uphold and virtual reality start-up Live Planet. A big focus for the latter, Minor said, is to ensure people can still use government-backed currencies like the dollar.
“The single most important thing that has to happen in 2020, if any of these projects are going to work out, is there needs to be wide-scale acceptance,” Minor said. “Using crypto tokens as payment creates so much friction that the businesses cannot work.”
“Everybody said bitcoin was going to become the new currency,” he added. “Human beings, normal ones, cannot afford the volatility of bitcoin.”