The Libra Association has announced it is planning to apply for a payments license in Switzerland, in the latest step towards ensuring regulatory compliance for the project.
The association, which was set up to oversee Facebook’s Libra stablecoin project, submitted a request to Switzerland’s Financial Market Supervisory Authority (FINMA) for clarification on how the regulator would classify its token.
The news confirms rumours that the Libra Association was looking to establish itself in Switzerland, which looks set to become its primary regulatory authority — against the wishes of regulators in the United States.
In a press release published today, the Libra Association said Switzerland was chosen for its role as a “nucleus” in international commerce.
The choice of Switzerland as the home for the newly established Libra Association, which when fully developed will have a diverse group of member organizations spanning technology, financial services, social impact organizations and venture capital, among others, harnesses Switzerland’s role as a nucleus for international organizations.
The Libra Association draws support from firms including Facebook, PayPal, Visa and Mastercard, and is aiming to create a digital currency for quick, low cost payments worldwide.
However, the plans have met stiff opposition from regulators, with many citing concerns over money laundering, terrorism financing and risks to the wider monetary and financial systems.
Both lawmakers and regulators in the U.S. have criticized the project, as well as senior politicians across Europe. Notably, the French finance minister was amongst the most robust in his critique of the proposals, with the Libra Association set for regulatory difficulties on multiple fronts as it plans its global rollout.
According to the Swiss FINMA, the structure of Libra means that the project would go beyond a pure payment system:
Due to the issuance of Libra payment tokens, the services planned by the Libra project would clearly go beyond those of a pure payment system and therefore be subject to such additional requirements.
With the Libra Association now planning to apply for a Swiss payments license, it remains to be seen whether this opens doors for the project, ahead of its international launch.
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