Facebook Says It Won't Launch Crypto in India Due to Regulatory Issues

Daniel Fowler
July 10, 2019

Many global central banks, including the European Central Bank and the Bank of England, have voiced concerns about this digital currency.

The representative is likely referring to an order by the central bank, the Reserve Bank of India (RBI), which last April effectively banned banks from providing services to cryptocurrency-related firms such as exchanges.

According to a report by the South China Morning Post, China's central bank (PBOC) may well be looking into an official sanctioned cryptocurrency in response to Facebook's foray into the industry...

Facebook Inc., facing fury from skeptical lawmakers, sought to mitigate concerns that have been raised about its proposed cryptocurrency, stating that the token's goal is to create a secure and low-priced way for consumers to move money around the world.

Huang Yiping, director of the Digital Finance Research Center of Peking University and a former member of the PBOC monetary committee, said the birth of Libra serves as an "alert" for China's digital currency innovators and regulators.

Marcus's letter is only the latest in a long rally between Congress and Facebook, since the latter published the White Paper for its future currency, Libra.

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China, in particular, is concerned over the potential impact the dollar-dominated composition of the Libra basket will have on cross-border payments, monetary policy and financial sovereignty.

The POBC has been working on developing its own digital legal tender.

Facebook has responded to demands from the U.S. Senate Banking Committee for answers on the regulatory status of its cryptocurrency project Libra, although steered clear of calls to halt the initiative entirely.

Li Zhenhua, executive director of the Ant Financial Research Institute, part of the Alibaba Group, said the market is anxious about whether Libra will develop into a type of credit money.

And with Facebook having stated that one of the goals of Libra is to enhance access to financial services for the unbanked, being locked out of India would deny Facebook the second-largest market in the world, by virtue of the unbanked population residing there. The government, though, says it is "open" to new innovations in the sector if these do not threaten the stability of the local ecosystem.

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