France decided to create a new G7 task force in order to understand how central banks can regulate virtual currencies such as Libra. This virtual currency was launched by Facebook earlier this week with the intention to use it as a means of payment. The information was released by Reuters a few hours ago.
France Creates New G7 Crypto Task Force
According to Governor Francois Villeroy de Galhau, the task force would be led by Benoit Coeure, a board member of the European Central Bank (ECB). The goal is to ensure cryptocurrencies are governed by regulations such as money-laundering laws and consumer-protection rules.
Facebook announced on Tuesday that they will be introducing a new cryptocurrency called Libra, which aims at improving payments and make it easier for WhatsApp and Facebook Messenger users to pay for goods and services. The Libra association based in Geneva has joined 28 partners that include Mastercard, PayPal and Uber, among others such as Visa.
After the announcement made by Facebook, several regulatory agencies around the world started wondering how to deal with it and how to control it. Bank of England Governor Mark Carney explained that Libra had to be safe or it would not happen. Moreover, he explained that banks around the world would have to oversight it.
At the moment, France is holding the rotating presidency of the Group of Seven nations, that includes the United States, France, Japan, Canada, Germany, Russia, Great Britain and Italy. The G7 said that it does not oppose the new digital currency created by Facebook, but it opposes that instrument becoming a sovereign currency.
Villeroy commented about it:
“We want to combine being open to innovation with firmness on regulation. This is in everyone’s interest.”
The new virtual currency created by Facebook is going to be backed by different fiat currencies such as the US dollar, the Euro, the yen and the British pound. This is going to provide users with a stabelcoin that would have a price that fluctuates as a fiat currency without having to be worried about large price swings such as the ones that affect other virtual currencies such as Bitcoin.
Moreover, Villeroy has also called for the creation of a network of national anti-money-laundering authorities, that would be coordinated by the European Banking Authority. This agency will be carrying out emergency measures and work as a substitute for national authorities.