ECB Coeure: Facebook’ Libra is Too Dangerous in the Regulatory Void!

The European Central Bank Executive Board member Benoit Coeure urged the financial regulators to take prompt actions regarding the advent of Facebook’s Libra coin, as reported by Bloomberg on 7 July.

Coeure addressed his concern on Facebook in Aix-en-Provence in southern France on Sunday. He said “It’s out of the question to allow them to develop in a regulatory void for their financial service activities, because it’s just too dangerous.”

Regulators react differently on Facebook’s Libra coin. For example, the Bank of England governor, Mark Carney exhibited a friendly attitude towards Libra. He said “Libra could substantially improve financial inclusion and dramatically lower the cost of domestic and cross-border payments.” While in the United States, over 30 organizations signed up a letter to request moratorium on Facebook’s Libra until the questions raised in the letter are addressed. The US Congress also issued a letter to request a moratorium on Facebook’s Libra until the regulators and Congress have the opportunity to examine the existing issues and take actions, as reported on 4 July.

Coeure highlighted the deficiencies in existing regulation for digital currencies and the banking system has failed to adopt the new technology. He added “All these projects are a rather useful wake-up call for regulators and public authorities, as they encourage us to raise a number of questions and might make us improve the way we do things.”

European Central Bank policy maker Ardo Hansson said the cryptocurrencies will die as a “complete load of nonsense.” He added that cryptocurrencies is a bubble that has already started to collapse, as reported in January.

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