Tue. Apr 7th, 2020

Brussels says it's "too soon" to have an analysis on the cryptocurrency of Facebook



The European Commission has assured that it is still "too soon" to have a detailed analysis of the consequences that the launch of Libra would have, the cryptocurrency of Facebook, in the European Union, because the community authorities do not yet have "sufficient information".

In any case, the Community Executive believes that it is "likely" that the famous social network will have to ask the European authorities for "some kind of authorization" to operate within the block once Brussels knows all the details of this cryptocurrency.

«For now it is too early to give a comprehensive and comprehensive evaluation of Libra because simply we don't have all the details yet», The European Commission spokeswoman for Financial Services, Vanessa Mock, said in a press conference.

The "short-term" priority of Brussels, therefore, is to obtain as much "clarity" as possible about the Facebook project in order to make a legal analysis. "Now we don't have enough information to do it," Mock explained.

Therefore, the European Commission's efforts are now focused on coordinating the work in this regard together with other community institutions, such as the European Central Bank (ECB), and international to know the "implications" of the launch of this currency.

France believes that the EU will not authorize it

These statements from the European Commission come after French Finance Minister Bruno Le Maire warned that the European Union will not authorize Libra because it questions the monetary sovereignty of the states and entails numerous risks, including a systemic one, given the enormous dimension of that social network.

"That eventual privatization of a currency poses risks of abuse of a dominant position, poses risks of sovereignty, poses risks for consumers and businesses, and poses a systemic risk», Because Facebook has 2 billion users worldwide, said Le Maire in Paris.

The French minister, who was participating in the first session of a blockchain forum of the Organization for Economic Cooperation and Development (OECD), said that if the Libra project materialized, the monetary sovereignty of the states would be questioned.

In his opinion, given the power of Facebook, that cryptocurrency would replace weak currencies of sovereign countries, which would "question the independence of states."

In addition, Libra could escape the obligations imposed by state monetary authorities to fight money laundering or terrorist financing. «I say it very clearly, in these conditions we cannot authorize the operation of pound in the European territory, ”he stressed.

Le Maire recalled that the G7 finance ministers at the meeting he hosted last July in Chantilly, north of Paris, "unanimously" expressed concern about the Facebook project. But he claimed a reaction from the banking system.

In his opinion, Facebook takes advantage of the high cost and slowness of international financial transactions today. That is why he said he has asked banks to make proposals to improve the international payment system and reduce its costs. He also proposed that an international reflection on the creation of "a public digital currency" be launched.

He said that he has discussed this issue with the president of the European Central Bank (ECB), Mario Draghi, and with what will be his successor Christine Lagarde.

Le Maire wants the reflection on a public digital currency to be launched at the October ministerial meetings of the International Monetary Fund and the World Bank in Washington and that in a few months there are "concrete projects" for which it has the OECD's collaboration.

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