Facebook to face 26 central bank officials over Libra crypto project

Daniel Fowler
September 19, 2019

Facebook has marketed Libra as a chance to offer affordable digital commerce and financial services to over a billion "unbanked" persons - adults without bank accounts or people who use services outside the banking system, for example, payday loans.

Besides, the meeting will reportedly happen among Libra and the Committee on Payments and the Bank of International Settlement's forum, Market Infrastructure.

Backing the ECB's plan to develop an alternative public cryptocurrency, France and Germany, the two most powerful nations in the European Union, have already said they could ban Facebook's Libra in Europe due to the risks it poses to monetary sovereignty.

In a joint statement, France's Bruno Le Maire and Germany's Olaf Scholz warned of the dangers to consumer interests and financial stability, stating: "France and Germany consider that the Libra project, as set out in Facebook's blueprint, fails to convince that those risks will be properly addressed". This almost-anonymity was in part due to size.

Facebook's crypto-project initiative "Libra" has been encountering series of regulatory hindrances before an exact take-off. Tether, the largest of the stablecoins remains only a fraction of the size of bitcoin, the largest of all the cryptocurrencies.

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A Libra spokesman said the event was "constructive", adding that the association was committed to engaging with central banks and regulators to realise its goal of a stable and low-priced payment system.

Albeit, the prices of Libra may not always align with the underlying assets, holders should have a "high degree of assurance" that they can convert coins into traditional currency based on an exchange rate, according to the project's information.

"Whether it's bitcoin, Libra or any other cryptocurrency, our message is the same to all of these companies: anti-money laundering and combating the financing of terrorism has to be built into your design from the get-go".

Speaking at an OECD conference in Paris, the minister said Facebook Libra would put national security and sovereignty of governments at risk. Instead, he sees Libra as a "better payment network and system running on top of existing currencies".

"The monetary sovereignty of countries is at stake from possible privatization of money by a sole actor with more than 2 billion users on the planet", Le Maire said, according to Vice News.

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