Facebook Libra faces fresh opposition in Australia, Switzerland

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Facebook’s troubled Libra stablecoin is no closer to launching, after running into fresh opposition from regulators worldwide.

The latest resistance comes from regulators in Australia and Switzerland respectively, which appear fatal to a global launch on the original timescale.

Authorities in Libra’s home jurisdiction of Switzerland described the project as a “failure,” with regulators saying this week they were unable to approve the cryptocurrency for launch in its current format, Bloomberg reported.

In a series of damning comments to local broadcaster, Swiss finance minister Ueli Maurer said the basket of cryptocurrencies backing Libra was insufficient, as they hadn’t been approved by national central banks.

Nils Reimelt of Zurich-based advisory firm Capco Digital said the Swiss and other global regulators would remain in-step with the U.S. Securities and Exchange Commission (SEC) in deciding their regulatory approach: “As long as the SEC is concerned about Libra, saying it’s based on relatively new and unproven technology and could rival the U.S. dollar, other governments including the Swiss will take a wait and see approach.”

Meanwhile, regulators in Australia have taken a similarly stringent line against the stablecoin. In a submission to the Senate Select Committee on Financial Technology and Regulatory Technology published this week, the Australian Prudential Regulatory Authority (APRA) said Libra would fall within its regulatory orbit, thereby creating fresh hurdles for Facebook to overcome if it is to win approval there.

The Reserve Bank of Australia has previously said Libra could only ever be permitted once all regulatory conditions were met, as well as expressing skepticism as the demand for the stablecoin in Australia.

While the submission creates further headaches for the project, it leaves the door open to the possibility of approval at some point in the future.

“The new framework is intended not only to be fit for purpose for the current financial system but also be able to accommodate future developments and technological advances, such as proposals for global stable coin eco-systems that have been the subject of significant attention in recent months,” according to the APRA report.

Libra had originally been planned to launch within the first six months of this year globally, with regulation handled on a jurisdiction by jurisdiction basis. But with widespread opposition from regulators across the board, it now looks unlikely to be launching any time soon.