Australian Regulators to Exercise Formal Power to Press Facebook for Details on Libra
- Facebook to answer the Australian regulators’ question or OAIC will use formal power
- Libra ecosystem also poses many risks and threats – ASIC Committee
- Stablecoin include features that are “typical of regulated securities” – IOSCO
- Libra is an “abomination, a twisted perversion of cryptocurrency,” – John McAfee
The financial regulators of Australia may force Facebook (FB) to reveal details about its plan for the cryptocurrency Libra, the Australian newspaper reported on Wednesday.
Reportedly, Australian regulators will be using their formal powers to press the social media giant on its plans to launch its so-called “stablecoin” following an unsatisfactory meeting with the company in October.
“If we don’t get answers to these questions from the U.S.-based team we will then need to consider whether formal powers are exercised where available,”
Elizabeth Hampton, deputy commissioner at Office of the Australian Information Commissioner (OAIC) — the national regulator for privacy and freedom of information — has been quoted as saying in an email to other regulators.
If Libra couldn’t be effectively supervised, a specialist committee that is looking at the emerging threats for the Australian Securities and Investments Commission warned in July that “all regulated entities” and consumers and investors could be affected.
“The proposed Libra ecosystem also poses many risks and threats, including the proliferation of scams based on Libra via mobile apps,”
said the ASIC committee adding,
“We also expect that we may identify more risks and threats once we have more information.”
A Facebook spokesman meanwhile said that they will continue to work with the regulators,
“to ensure that this global financial infrastructure is governed in a way that is reflective of the people it serves.”
Libra is an “Abomination” & could be subject to Securities Rule
On Monday, Global securities watchdog IOSCO said existing securities rules could apply to Libra.
“Our analysis has shown that so-called ‘stablecoins' can include features that are typical of regulated securities,”
IOSCO said in a statement.
The watchdog, which is made up of securities regulators including the United States, Europe, and Japan said stablecoin can potentially offer benefits as well as pose risks.
International regulators are not alone in expressing concern about Facebook’s cryptocurrency, the industry is just as skeptical.
John McAfee blasted Libra by calling it an,
“abomination, a twisted perversion of cryptocurrency. By its very definition, cryptocurrency wants to free us from control, but Libra is nothing but control.”
According to him, this will only give Facebook CEO Mark Zuckerberg more domination over its users.