On Thursday, Bruno Le Mair, France’s Minister of the Economy and Finance, warned that the country will halt the development of Facebook’s planned cryptocurrency, ‘Libra,’ since the digital asset poises threats to the “monetary sovereignty” of governments.
The announcement was made by Le Maire as a part of the opening speech at the Organisation for Economic Co-operation and Development (OECD) on Global Blockchain Policy Forum 2019 in Paris, France. He said as AFP reports, “I want to be absolutely clear: in these conditions, we cannot authorize the development of Libra on European soil.” He had made a similar comment in June ruling out the possibilities of Facebook’s Libra to become a sovereign currency. He considered it totally “out of the question”.
Although, it’s not the first time that French officials have been outspoken in warning people about the danger that Libra poses. Considering Facebook a centralized unit with over 2 billion global users, they believe that privatisation of money largely puts the monetary sovereignty of countries at stake from possible privatisation of money. Their major concerns included the possibility that Libra could allow people abandon national currencies at times of crisis, which, in return, would complicate the government’s efforts to manage the economy.
On the other side, the creator of Libra strongly hopes that the cryptocurrency’s centralised infrastructure might allow it to take the shape of a global currency that could rival the US dollar. And, they’re not absolutely wrong in believing that since the crypto asset has been designed to allow users to make payments across the entire lineup of Facebook’s suite of apps (including WhatsApp) which now boasts of billions of users around the world.
Libra has been marketed by Facebook as an opportunity that would empower more than 1 billion “unbanked” people to be part of low-cost online commerce and financial services. Coupled with Calibra, the digital wallet accompanying Libra, the company promises to eventually expand its own commercial offering alongside other financial services, allowing more SMBs to invest in Facebook ads.
However, Facebook has encountered massive criticisms from policymakers and financial watchdogs, ever since Libra has been announced. Even at the Congressional hearings this July, U.S. senators heavily bashed the plan of this proposed cryptocurrency.
Libra’s head of policy and communications, Dante Disparte, though, has said,
We welcome this scrutiny and have deliberately designed a long launch runway to have these conversations, educate stakeholders and incorporate their feedback in our design. We are committed to working with regulatory authorities to achieve a safe, transparent, and consumer-focused implementation of the Libra project.
Facebook has also previously reported that the launch of Libra will be held back until it has satisfied all concerns of global regulators.