G7 nations throw up yet another obstacle to Facebook's weight
The slow march to the death of Awake Facebook's upcoming cryptocurrency, continues. Yesterday, a group of seven nations' working group threw up a new obstacle in a report, stating that stable stacks like Libra could potentially destroy the global monetary system and increase financial stability.
Title “ Investigating the Impact of Global Stackecoins ” The report is the result of a G7 Working Group, led by Benoit Coeure, a member of the European Central Bank. "The G7 believes that no global stablecoin project should start operations until the legal, regulatory and regulatory challenges and risks are adequately addressed, through appropriate design and by following the regulations that are clear and proportionate to the risk," the report reads.
What makes stablecoins different from other cryptocurrencies is that they are backed by traditional currencies to offset the volatility of digital currencies – hence the stable moniker. That said, stackcoins have so far been limited and remain very unregulated. Specifically, the G7 working group identified that stablecoins could attempt to curb money laundering and terrorist financing, in addition to posing risks to fair competition, cybersecurity consumer privacy and taxation.
The Libra Association – the oversight group responsible for hiring Facebook's cryptocurrency – also issued a statement in response to the G7 report. In it, the group tackles G7's concerns point by point, and promises to work with regulators to resolve concerns. Because, you know, it must play fine if it wants a shot at ever-existing. "Recognizing the importance of stability in the global financial system and national sovereignty over monetary policy, Libra is designed to work with existing regulatory institutions and apply the protection they provide to the digital world – not interfere or undermine them," the statement reads.
Although the G7 report is not the final nail in Libra Coffin, it is a telling sign that global regulators are not sold on Fac's (19459008] ebook's vision. It has already had consequences. When Vågen was launched in June it had 27 companies in the corner – including well-known payment institutions such as Visa and Mastercard. But right out of the gate, cryptocurrency was met with resistance from the United States . House Committee on Financial Services and Senate Banking Committee . This in turn led to rumors that Libra partners got cold feet in late August, and as PayPal officially called it quits in early October. A few days later eBay, Stripe, Visa and Mastercard also jumped ship . By adding salt to the wound, Calibra – the cryptocurrency subsidiary – is facing a lawsuit alleging that the logo was pulled by from Current, a mobile banking app.
Facebook CEO Mark Zuckerberg is scheduled to testify to the House Financial Services Committee on October 23. He is likely to need to to address the many concerns that G7 has brought, as well as the fact that major supporters believed giving Weight credibility has since distanced himself from the project. Considering how Zuckerberg's latest attempt to speak as a human being has gone, he may well be the one who inadvertently put Libra out of his misery.
[ Reuters ]
