Facebook’s Libra encountered a further regulatory blow Thursday, with a senior French official suggesting the stablecoin cannot be allowed to operate within the European Union.
French Finance Minister Bruno Le Maire made the remarks at a meeting of the Organization for Economic Co-operation and Development in Paris, where he set out a number of concerns about the project.
Criticizing what he called the “privatisation of money,” Le Maire said the risks were too many and severe to be tolerated by regulators in the EU, Reuters reported.
This eventual privatization of money contains risks of abuse of dominant position, risks to sovereignty, and risks for consumers and for companies.
Le Maire noted how Libra “represents a systemic risk from the moment when you have two billion users,” noting, “All these concerns about Libra are serious. I therefore want to say with plenty of clarity: in these conditions we cannot authorize the development of Libra on European soil.”
While there were no details on how Le Maire intends to prevent Facebook’s Libra from gaining access to EU markets, the comments are amongst the most resolute from a European official to date.
The news comes in the same week as the Libra Association took steps towards regulation in Switzerland, which while outside of the EU, offers a close relationship for firms establishing in the country.
The decision follows an indicative classification from the Swiss FINMA, suggesting Libra would require a payment services license to operate in the jurisdiction.
Le Maire’s comments echo concerns raised by regulators elsewhere, including in the U.S., with fears of financial risks and criminality prominent in the reckoning of lawmakers.
Nevertheless, the Libra Association said the increased scrutiny of regulators underlines their efforts to work closely with regulators worldwide.
The comments today from France’s economy and finance minister further underscore the importance of our ongoing work with regulatory bodies and leadership around the world.
It remains unclear whether Libra is intending to apply to any regulators within the European Union.
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