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The company created to manage Facebook's Libra cryptocurrency project is seeking to apply for a license as a payment system in Switzerland.
The FINMA Swiss Financial Regulator confirmed Wednesday in a guidance note on stablecoins that he had received a request for an assessment of how he would rank the Balance project in the manner provided. The agency added that the range of services projected by the Libra association would require additional monitoring.
FINMA stated:
"Due to the issuance of Libra payment tokens, the services provided by the Libra project would clearly go beyond those of a pure payment system," FINMA said, noting that it would mean that 39 it would be subject to such additional requirements.
In an "indicative ranking" of the Libra project, FINMA declared that a project would fall under the regulation of financial market infrastructures and, as expected, "would require a payment system license from FINMA".
Regulators around the world have expressed concerns that Libra would increase the risk of money laundering thanks to its global cryptocurrency available to billions of Facebook users. Only yesterday, US Treasurer Sigal Mandelker said that Facebook's Balance had to meet the highest standards of compliance before any launch.
A Swiss payment system is "automatically subject" to the law on the fight against money laundering, FINMA said.
The watchdog alluded to the extent of the regulations required by Libra, saying:
"Under the FMIA, any additional services that increase the risks of a payment system must be subject to the corresponding additional requirements. This means that all the potential risks of a Swiss payment system, including banking risks, can be addressed by imposing appropriate requirements in line with the maxim "same risks, same rules". "
These additional requirements "would include the allocation of capital (for credit, market and operational risks), the concentration of risks and liquidity, as well as the management of the Libra reserve", said FINMA.
One of the requirements for obtaining a Swiss payment system license is that the "returns and risks" related to the management of the reserve "are entirely the responsibility of the Libra Association and not – as in the case of a fund provider – from the "stable room". "Holders".
Libya being planned as a global project, it will require international coordination of regulators, FINMA said, in particular to define the requirements for the management of the reserve and its governance, as well as to deal with the risk of money laundering. capital.
According to a Reuters report, the Libra association reportedly said:
"We are engaged in a constructive dialogue with FINMA and we see a way for a free-source blockchain network to become a regulated, low-friction and highly secure payment system," said the Libra Association, Geneva.
According to another Reuters report released Tuesday, the Financial Action Group (FATF) would also look at Libra.
"We want to make sure that the important risks have to be solved," said FATF President Xiangmin Liu.
Image Facebook Balance via Shutterstock
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