The leaders of seven of the largest economies in the world (G7) have emphasized their position that Facebook’s Libra cryptocurrency will not come to live until there are proper regulations in place, Reuters reported. The information agency sourced its story from a draft of a statement, that should be published today.
Central banks and Finance Ministers of the United States, Japan, Canada, Italy, France, Germany, and the United Kingdom have once again come to the conclusion to discourage the stablecoin projects until they put proper regulatory oversight: “The G7 continues to insist that no global stablecoin project can be launched until legal, regulatory and regulatory requirements are properly enforced through proper design and compliance with relevant standards.”
The statement also emphasizes on the cyber-security aspect that was exacerbated after the outbreak of COVID-19, when a big volume of transactions was moved online.
The G7 task force has long looked askance at Facebook’s cryptocurrency brainchild – as recently as last year, country representatives gathered on multiple occasions to decide how central banks could regulate cryptocurrencies. The issues raised included consumer protection, anti-money laundering measures, the threat to the financial system, and other important topics.
The conclusion then was: “Ministers and governors recognized that while innovation in the field of finance brings substantial benefit, it can create risk as well. They [ministers] agreed that stablecoins and other new ideas currently being pursued, including ideas with global and potentially system-altering reach, such as Libra, pose serious regulatory and systemic problems, as well as raise more serious policy questions that should be resolved before these projects can be implemented.
“And it went on to say, “On regulatory issues, ministers and central bank heads came to the conclusion that stablecoin initiatives and their operators, such as Libra, could have a negative effect on monetary sovereignty and the principles of functioning of the global monetary and financial systems.”
