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| Facebook's move into cryptocurrency comes with the leading social network moving toward CEO Mark Zuckerberg's vision of shifting away from being a "digital town square" to small-group messaging and payments (AFP/File) |
Chantilly
(France) (AFP) - The G7 group of the world's most developed economies are
worried about Facebook's planned Libra cryptocurrency and have a shared
consensus about the need to act quickly, a French official said Wednesday.
Facebook
last month unveiled its plans for Libra in an announcement greeted with concern
by governments and critics of the social network behemoth around the world.
The issue
was at the forefront of the minds of ministers and central bankers from the G7
group of most developed economies as they kicked off a two-day meeting in
Chantilly outside Paris on Wednesday.
"On
Libra, we had a very constructive and detailed discussion with a very large and
shared consensus on the need for action," said the official, who asked not
to be named.
"Concerns
(were) expressed by all the participants about the current situation and the
need to act quickly."
'Conditions not in place'
The finance
ministers of France and Germany had earlier expressed serious reservations
about Facebook's plans because of Libra's possible impact on global financial
stability.
"The
G7 finance ministers and central bankers who are here have serious concerns,"
said German Finance Minister Olaf Scholz.
"They
want to be sure that all existing regulations are adhered to, and if they
should be changed in the future, so that we can guarantee the stability of the
international financial system," he added.
"We are
talking about currency stability, security, data protection and democratic
control," he added.
French
Finance Minister Bruno Le Maire, who has warned about Libra repeatedly since
the launch announcement, said "the conditions are not yet in place today for
Libra to be introduced."
He said he
hoped the G7 would consider the necessity of a "framework or a
regulation" and also "what would be the conditions that would make
such an instrument feasible."
"Today,
we cannot accept that an exchange instrument comes into being when it does not
respect any of the precautionary rules that all sovereign currencies are
required to abide by."
Their
comments echoed warnings issued on Monday by US Treasury Secretary Steven
Mnuchin, who was also present at the meeting.
Mnuchin
said Facebook must meet "a very high standard" before it moves ahead
with Libra, adding that US regulators have already expressed concerns to the
company.
He said
that these kinds of virtual currencies have in the past been associated with
money laundering and illicit activities.
"Whether
they're banks or non-banks, they're under the same regulatory
environment," Mnuchin told reporters at the White House.
Libra is
widely regarded as a challenger to dominant global player bitcoin. Expected to
launch in the first half of 2020, Libra is designed to be backed by a basket of
currency assets to avoid the wild swings of bitcoin and other cryptocurrencies.
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