Facebook’s Libra to Be Scrutinized by G7 Taskforce

A Reuters news report indicates that G7 nations are setting up a taskforce to study how central banks can oversee cryptocurrencies such as Libra, which is being planned to be introduced by Facebook next year.

Regarding the setting up of task force, Francois Villeroy de Galhau, the governor of France’s central bank, said “We want to combine being open to innovation with firmness on regulation. This is in everyone’s interest.”

Furthermore, the governor clarified that Paris is not trying to oppose the creation of Libra but is opposing attempts to make it a sovereign currency.

There have been concerns over the manner in which cryptos follow anti-money laundering rules, consumer protection safeguards and other regulatory details.

The G7 takforce will be headed by Benoit Coeure, who is on the board of the European Central Bank.

The world response to Libra has been mixed. Jerome Powell, the Fed Chair has opined that Libra offers certain advantages and also threats to the world financial system. The Chairwoman of the US Financial Services Committee has suggested the social network to suspend the project until the scrutiny gets completed.

Three days back, Mark Carney, Bank of England’s governor stated that he trusts his central bank “will wind up having quite high expectations from a safety and soundness and regulatory standpoint.”

On the same day, a Russian government official categorically stated that the country will not approve Libra as it could make the domestic financial system vulnerable.