Facebook’s digital coin ‘Libra’ is expected to release at the beginning of 2020 as per the official Facebook statement. Facebook might be scaling up its development process, but global regulators have raised few concerns and should be resolved by Facebook before launching its global coin.
A person informed Reuters that global regulators will not allow Facebook to launch its digital currency ‘Libra coin’ unless their issues are addressed, relating to money laundering and financial stability issues. To resolve the concerns, a long discussion should take place.
Facebook officially revealed its Libra project in June, before this lot was speculated. They said that the stablecoin will be supported by a basket of legal currencies, namely the US dollar, the euro, the British pound, and the yen. Libra coin can be used by millions of its users across the world. Facebook is planning to release the coin in early 2020.
The European Central Bank executive member, Benoit Coeure who heads an international working group on Libra project mentioned Facebook to offer crypto service globally, and the currency needs to be safe ‘from day one’ not only for its users but also for the financial system and officials battling crime.
Coeure told in an interview during the G7 Summit at France in Chantilly. The cryptocurrency needs to be safe, resilient, and robust from the start. It’s not a learning technique; it may work or may not work.
He further mentioned Facebook’s Libra currency will not be released unless global regulators are happy.
The existing design of Libra coin might allow users to exchange money using a code name that might be used for money laundering or to fund terrorism.
The global regulators also want to know the safety measures taken by Facebook and other 27 Libra Association members to guarantee that the privacy and ownership rights of users are secured.
Coeure stated Facebook and regulators need to have a ‘prolonged discussion’ on how to modify the existing national and international policy to cover Libra coin.
He told,
“Down the road, we might find that there are gaps or inconsistencies that would require a prolonged discussion by regulators on how to do it differently.”
Coeure further added regulators are not going to allow such projects to be implemented unless they are satisfied with the answers and before they develop an appropriate regulatory framework.
Digital currencies throughout the world are exposed to irregular rules and the emerging technology widely remains uncontrolled.
Few smaller nations such as Belarus and Malta have created a unique rule; leading economies have considered applying existing financial policy.
However, Facebook responded on its launch, saying it will not go ahead with its launch plan unless it resolves all regulatory issues.
Meanwhile, Coeure mentioned that his G7 working group on Libra coin will continue working on the issue till October the day of International Monetary Fund’s annual session, after that it will provide the matter to the Financial Stability Board of global financial regulators.
In July, Coeure asked global regulators for quick action with regards to Libra coin. The ECB authorities mentioned that permitting a new cryptocurrency such as Libra to release on a large scale, without correct regulations and safety, might be unsafe.
