The development and launch of Facebook’s planned digital currency Libra in Europe will be blocked by France because it feels that it is threat to the "monetary sovereignty" of various European governments.
Libra presented financial risks and could be used for financial abuse, said French Finance Minister Bruno Le Maire. The minister however did not provide any details about how the French government plans to prevent Libra from being launched and used in the European Union which currently has 28 members including the United Kingdom.
The plan for launching of the digital currency was announced by the social media giant in July. However the plan has been questioned and criticized from multiple quarters.
"This eventual privatization of money contains risks of abuse of dominant position, risks to sovereignty and risks for consumers and for companies," said while Talking about Libra at a meeting of the Organisation for Economic Co-operation and Development, in Paris,
He had held meetings and talks with both the incoming and outgoing heads of the European Central Bank in relation to the creation of a "public digital currency" according to the guidance of international financial institutions, Le Maire said.
"Libra also represents a systemic risk from the moment when you have two billion users. Any breakdown in the functioning of this currency, in the management of its reserves, could create considerable financial disruption," said Le Maire. "All these concerns about Libra are serious. I therefore want to say with plenty of clarity: in these conditions, we cannot authorize the development of Libra on European soil," he added.
It is expected that Facebook would launch Libra, which is supported by payments firms Visa and Mastercard and taxi apps Lyft and Uber, sometime next year according to reports.
A Switzerland-based non-profit association would be given the control of Libra and it has been reported earlier in the week the Libra Association, which is the conglomerate of companies that is developing it, has already sought an application with the Swiss body.
However this week, the Swiss government said that strict rules that typically apply to banks would be faced by the proposed payments system which was a setback for the cryptocurrency developers. Libra would also face all the applicable anti-money laundering laws.
In July, a warning was issued by the Group of Seven advanced economies saying that until all regulatory concerns had been addressed, Libra would not be allowed to be launched by it. It also said that approval for the proposed project would first require prolonged discussion about it.
The potential impact of Libra is being investigated by the United States Congress. On the other hand, a number of chiefs of central banks, including UK's Mark Carney, have raised concerns and questions about the proposed crypto currency. He is "not a fan" of the currency, US President Donald Trump has tweeted.
(Source:www.bbc.com)
Libra presented financial risks and could be used for financial abuse, said French Finance Minister Bruno Le Maire. The minister however did not provide any details about how the French government plans to prevent Libra from being launched and used in the European Union which currently has 28 members including the United Kingdom.
The plan for launching of the digital currency was announced by the social media giant in July. However the plan has been questioned and criticized from multiple quarters.
"This eventual privatization of money contains risks of abuse of dominant position, risks to sovereignty and risks for consumers and for companies," said while Talking about Libra at a meeting of the Organisation for Economic Co-operation and Development, in Paris,
He had held meetings and talks with both the incoming and outgoing heads of the European Central Bank in relation to the creation of a "public digital currency" according to the guidance of international financial institutions, Le Maire said.
"Libra also represents a systemic risk from the moment when you have two billion users. Any breakdown in the functioning of this currency, in the management of its reserves, could create considerable financial disruption," said Le Maire. "All these concerns about Libra are serious. I therefore want to say with plenty of clarity: in these conditions, we cannot authorize the development of Libra on European soil," he added.
It is expected that Facebook would launch Libra, which is supported by payments firms Visa and Mastercard and taxi apps Lyft and Uber, sometime next year according to reports.
A Switzerland-based non-profit association would be given the control of Libra and it has been reported earlier in the week the Libra Association, which is the conglomerate of companies that is developing it, has already sought an application with the Swiss body.
However this week, the Swiss government said that strict rules that typically apply to banks would be faced by the proposed payments system which was a setback for the cryptocurrency developers. Libra would also face all the applicable anti-money laundering laws.
In July, a warning was issued by the Group of Seven advanced economies saying that until all regulatory concerns had been addressed, Libra would not be allowed to be launched by it. It also said that approval for the proposed project would first require prolonged discussion about it.
The potential impact of Libra is being investigated by the United States Congress. On the other hand, a number of chiefs of central banks, including UK's Mark Carney, have raised concerns and questions about the proposed crypto currency. He is "not a fan" of the currency, US President Donald Trump has tweeted.
(Source:www.bbc.com)
