[ad_1]
G7 finance chiefs met this week and Facebook's Libra cryptocurrency was at the top of their agenda. They agreed on several crypto initiatives and regulatory responses to projects such as Libra, requiring them to meet the highest standards of financial regulation.
Read also: G20 Leaders' Statement on Cryptographic Assets – An Overview of Their Commitments
A call for urgent action
The G7 finance ministers and central bank governors met in Chantilly, north of Paris, for a two-day conference on 17 and 18 July. In addition to France, which chairs this year's meetings, the G7 includes Canada, Germany, Italy, Japan, the United Kingdom and the United States In addition, the European Union fully participates to the G7 since 1981 as an "unlisted" member. At the end of their meeting, the ministers published the Chair's summary of the decisions made.
"Ministers and governors have recognized that innovation in the financial sector can bring substantial benefits, but that it can also carry risks," the statement said. "They agreed that bank notes and other new products under development, including projects with a global and potentially systemic footprint, such as Libya, raise serious regulatory and systemic problems, as well as broader political problems. , both of which must be solved. to be implemented. "The details of the summary:
With regard to regulatory concerns, Ministers and Governors have agreed that any "stable enterprises" type of initiative and their operators should in any case respect the highest standards of financial regulation.
"On systemic concerns, ministers and governors have agreed that projects such as Libya could have an impact on monetary sovereignty and the functioning of the international monetary system," says the presidency summary.
"On Libra, we had a very constructive and detailed discussion with a very broad and shared consensus on the need to act," said a French official at the AFP news agency. After the presidency of the first day, French Finance Minister Bruno Le Maire reportedly told Reuters:
The sovereignty of nations can not be endangered … The general mood around the table was clearly one of the major concerns raised by the recent announcements of Libra, and a shared view that measures were urgently required.
"The issue of a currency does not belong to a private company, it is an essential characteristic of a sovereign state," said German Finance Minister Olaf Scholz. Stating that Facebook's plans "do not seem to be fully reflected", he is convinced that Libra "can not continue without all legal and regulatory issues being resolved," the media added. A senior Japanese finance ministry official at the meeting told reporters:
Most G7 members felt that Libya posed a serious problem from the point of view of consumer data protection and its impact on monetary policy.
Facebook recently unveiled plans for Calibra, a new subsidiary to provide financial services via the Libra network. "The first product that Calibra will introduce is a digital wallet for Libra, a new global currency based on blockchain technology," the company said.
Working Group on Global Coordination and the G7
The G7 set up a working group on euro coins, coordinated by Benoît Coeure, chairman of the Committee on Payments and Market Infrastructures (CPMI). Its preliminary conclusions were provided at the meeting.
The group initially includes senior officials from the G7 central banks, the International Monetary Fund (IMF), the Bank for International Settlements and the Financial Stability Board (FSB), reveals the president's summary, adding that it will be extended to G7 representatives. ministries of finance. The group will also coordinate with the G20 and other relevant standardization bodies. Its final report and recommendations are expected by the October annual meeting of the IMF and the World Bank.
The Governor of the Bank of Japan, Haruhiko Kuroda, believes that, given the potential impact of Libra on the global economy, the G7 Working Group would evolve over time to include more people. regulators, developing:
If Libra aspires to be used around the world, countries must seek a coordinated response on a global scale … This is not something that can be discussed between the only G7 central banks.
The central bankers pointed out that Facebook needed a banking license to accept deposits, and some feared that people could carry out transactions anonymously.
The working group of Japan, focused on crypto
In response to plans for the Libra on Facebook, Japanese regulators have also set up a task force in anticipation of the G7 Finance Ministers and Central Bank Governors meeting to discuss the potential impact of the project. digital currency on monetary policy and financial regulation, government sources said.
This working group is composed of the Central Bank of Japan, the Ministry of Finance and the Financial Services Agency (FSA), which is in charge of the country's banking regulations. "The group has begun in-depth discussions on various aspects of stable currencies," Japanese Finance Minister Taro Aso said at the end of the Mainichi meeting after the G7 meeting. . Sources told Reuters that the group "will seek to coordinate policies to deal with the impact Libra could have on regulation, monetary policy, taxes and payment regulation."
The officials explained:
Japan hopes to rally support from other countries to extend the Task Force to a larger group of tax and financial regulators, given the wide range of policies that can be affected by digital currencies.
As chair of this year's G20 meetings, Japan will look at ways to align the separate efforts of the G7 and G20 to address the impacts of Libra on policy, officials said.
At the G20 summit last month, G20 leaders said that "cryptographic badets do not threaten global financial stability at this stage." However, they "closely monitor the evolution of the situation and remain vigilant against existing and emerging risks". also asked the FSB and other standardization bodies "to provide advice on additional multilateral responses as needed".
Global Network for Cryptographic Payments
The Japanese government is also setting up "an international network for cryptocurrency payments, similar to the SWIFT network used by banks, to fight against money laundering," Reuters reported on Thursday, citing a person close to the file.
The plan, proposed by the country's Ministry of Finance and the FSA, provides for the establishment of the network in the coming years, says the publication. The Financial Action Task Force, the FATF, an intergovernmental standard-setting body in areas such as money laundering, will monitor the evolution of the system and Japan will cooperate with other countries. The plan of action for this new network was approved by the FATF in June, according to the source.
Go beyond the regulations in force
Japan's Finance Minister on Wednesday urged his G7 counterparts to comprehensively badess Libra for any new challenges that may not be compatible with the current regulations, highlighting:
Applying existing regulations may not be enough. A comprehensive review is needed to see if Libra poses new challenges that existing rules do not take into account.
"On the other hand, the authorities must react quickly so that they are not late," said the Minister of Finance.
Scales grilled by US lawmakers
Calibra's Facebook executive and CEO, David Marcus, appeared before the US Senate Banking Committee and the House Financial Services Committee this week. The committees asked him questions about the impact of the Libra on global monetary policy and the protection of customer data.
"Facebook has shown, scandal after scandal, that it does not deserve our trust … We would not be crazy to give them a chance to let them experiment with people's bank accounts," said Senator Sherrod Brown in his introductory remarks.
Representative Andy Barr told Marcus: "Tell me how Libra will not undermine sovereign currencies and central banks, or is it the very purpose of undermining central bankers and giving greater freedom to the central bank?" want to be very clear, we do not want to compete with the dollar or sovereign currencies. "
At Wednesday's hearing, Rep. Brad Sherman compared the potential consequences of Facebook's cryptography project to the September 11th terrorist attacks. "Some tell us that innovation is always good … The most innovative thing of this century is that of Osama bin Laden who had the innovative idea of flying two planes in towers "he said. Sherman claimed that if she succeeds, Libra could be "one of the most important things this committee has for this decade," then asked why Marcus had appeared in Congress for Facebook instead of CEO Mark Zuckerberg.
"I do not think you should launch Libra at all," said Rep. Carolyn Maloney to Marcus, while Rep. Madeleine Dean said, "Before I go to Libra, I think you should clean up the damage from the past. "According to Marcus:
Facebook will not offer Balance Digital Currency until it has fully addressed regulatory concerns and received appropriate approvals.
What do you think of how the G7 countries plan to manage cryptocurrencies, including Libra? Let us know in the comments section below.
Images courtesy of Shutterstock, the French government, Nikkei Asian Review, Kyodo News and Reuters.
Do you feel lucky? Visit our official Bitcoin casino where you can play BCH slot machines, BCH poker and many other BCH games. Each game has a progressive jackpot Bitcoin Cash to win!
Tags in this story
Bitcoin, BTC, Crypto, Cryptocurrencies, Cryptocurrency, David Marcus, Digital Currency, European Union, Facebook, France, G20, G7, Germany, Italy, Japan, Leaders, Libra, Meeting, Answers, Working Group, Summit , Taskforce, United States, Virtual Currency
[ad_2]
Source link
