G7 Plans A Task Force To Manage Facebook’s Libra Cryptocurrency
While the cryptocurrency enthusiasts are ecstatic about Facebook’s Libra cryptocurrency, various government regulators have raised concerns over it. According to Reuters reports on Friday, France plans to form a task force within the Group of Seven (G7) nations to govern the issues.
As per the report, the governor of the French central bank, Francois Villeroy de Galhau hints about a crypto task force, headed by European Central Bank board member Benoit Coeure. The task force would look over the cryptocurrency regulators in order to avoid money laundering and other problems.
Though Facebook’s Libra might not be the main reason behind the task force, France’s finance minister, Bruno Le Maire did express concerns on Tuesday, the Libra could gain traction and replace traditional currencies. He called in G7 central bank governors to prepare a report on Facebook’s project for their July meeting. Le Maire said at the time.
“It is out of question’’ that Libra be allowed “become a sovereign currency,” “It can’t and it must not happen.”
In the latest announcement, Villeroy states that France aims to be “open to innovation” but firm on regulation.
For months and weeks, Facebook kept his cryptocurrency a secret, the deeds were only disclosed on June 18, when the platform published a white paper. As per the white paper, a subsidiary, Calibra, and an independent consortium, Libra Association, will be in charge of governance and developing the cryptocurrency.
Libra will be a stablecoin pegged to a basket of fiat currencies and government-backed securities. Initially, it will be used as means of money transfer across the globe, subsequently developing into an ecosystem of financial services.
As per Villeroy, the regulators will still require a briefing for the concept of a stablecoin. As aforementioned, other regulators have been worrying about similar issues, including the U.S. and the U.K. Reportedly, the U.S. Senate Committee on Banking, Housing, and Urban Affairs has a hearing scheduled for Libra on July 16.
Markus Ferber, German European Parliament member also called for scrutiny, saying companies “must not be allowed to operate in a regulatory nirvana when introducing virtual currencies.” Notably, the G7 is a group of the wealthiest advanced economies as defined by the IMF, which currently includes Canada, France, Germany, Italy, Japan, the U.K. and the U.S. France currently holds the rolling presidency of the group.