The criticism of Facebook’s Digital currency, Libra continues to grow. Now the G7 to the project.
On Sunday evening, the BBC reported that the crypto project of Facebook is the focus of the G7. As BBC reported, the public broadcaster of the United Kingdom will receive a draft report of the G7, saying, allegedly, that future, widespread crypto-currencies such as Libra could pose great risks for the traditional financial system. Although the report was not even called Libra. However, the time and the report described the impact speaks clearly that Libra is meant to be.
To include the Task Force of the G7 group, which yesterday released the draft report, high level officials of Central banks, the International monetary Fund (IMF) and the Financial Stability Board (FSB), which coordinates rules for the the G20 countries. The report focuses on Libra as the big bad Wolf and outlines the main threats that it holds for all stable coins to be applicable. In a section entitled “position of resistance against new risks,” admitted the report that the world economy is faced with uncertainties arising out of declining interest rates, an escalating national debt and a weakening of the financial markets.
To meet these “new risks,” added the report, the FSB is developing a new monitoring framework to be introduced until next year. Among the numerous challenges, which they viewed as a threat to financial stability, consumer and investor protection, privacy and data protection, financial integrity including compliance with AML/KYC, as well as fair competition and antitrust policy. Basically all the things that can not offer Facebook taken.
A further facet of the report concerned the point that digital currency could have a direct impact on the monetary policy of the Central banks. For example, residents of a country could not see a way out of political decisions, the support of. If the Central banks and governments of the world interest rates to stimulate economic growth, could escape the Bevölherung in digital currencies, such as Libra. Central banks had no impact on Facebook, if you would not take over the whole network.
Libra could also threaten traditional financial services companies, because it might almost enable immediate, effective, free and private transactions, which would beat any of today’s existing consumer solution.
The results of the report are to be presented to the “Finance Ministers at the annual meetings of the IMF this week”. Here it comes, that a company such as Libra should not be able to be on the market until the above-mentioned risks are properly addressed:
The G7 are of the view that there is no Stablecoin-the project should begin operation until the legal, regulatory and Supervisory challenges and risks are adequately addressed.
According to the BBC, a separate report suggests that Libra may not receive any regulatory approval, even if it is able to remove the long list of concerns.
The management of such risks is not necessarily a guarantee for the authorisation of a stable coin agreement.
Remarkably, added the report, that he considers crypto-Assets such as Bitcoin as a threat.
The heads of state and government of the G20, noted that crypto-Assets, constitute at the present time, no threat to global financial stability, but that they will continue to observe existing and new risks.
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