EU to Address Risks Before Allowing Private Digital Currencies Like Facebook’s Libra
EU finance ministers have agreed on Thursday that private digital currencies like Facebook’s Libra shouldn’t be allowed in the EU before their risks are being addressed.
This means the bloc has a tough stance on the Libra, which has been widely criticized by regulators all over the world and had its influence on the financial system analyzed ever since it has been announced to launch. This is what the ministers have stated jointly:
“No global stablecoin arrangement should begin operation in the European Union until the legal, regulatory and oversight challenges and risks have been adequately identified and addressed,”
Libra Project Abandoned by Mastercard and Visa
While crypto coins aren’t backed by securities and traditional money, stablecoins are. Both of these are digital currencies, but different. After being pressured by regulators, the payments companies Visa and Mastercard decided to no longer back up Facebook’s Libra. They left the 20 other Geneva-based Libra Association members that are looking forward to the project being scheduled to launch in June 2020 too.
EU to Regulate Stablecoins and Crypto Assets as Part of Global Plan
The EU ministers have added that EU regulating stablecoins and crypto-assets would be part of the global plan. EU finance commissioner Valdis Dombrovskis said at the public Brussels meeting that the EU commission is working on making this happen. Ministers have also expressed their appreciation for the efforts the European Central Bank is making to develop a public digital currency as an alternative to a private one.