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Recently, a report by Der Speigel magazine in Germany indicates that the German government is against giving approval to private stablecoin issuers such as Facebook and its digital currency Libra.
The report cites a member of the current government, Thomas Heilman, who called for caution against these stablecoin issuers. He said that so far the economy of the region was in a great shape in monitoring inflation measures and countering any fiscal crises. But once a digital currency provider was allowed to monopolize the market, there will be no space left for competitors.
The announcement by the German minister was preceded by a statement of the France’s Minister of the Economy and Finance who also expressed a negative opinion of the recent developments spearheaded by Facebook that is looking forward to launch its own digital currency in the markets of Europe. But the French Finance Minister said that a proliferation of Libra in the region could threat the ‘monetary sovereignty’ of governments.
The statements came as a response to Facebook unveiling of its plan for users to be able to make crypto payments through the social networking platform. This plan was revealed in June as an elaborate blueprint to win support from various economies in the world. Both ministers, however, stressed that Facebook has consistently failed to address the potential risks that the European markets are opened to in the face of an onslaught by Libra.
Switzerland Is Friendlier to Libra
The German government has long debated the potential entry of private stablecoin issuers into the European market, which could lead to a monopolization of private currencies in the region and disrupt the digital financial markets.
On the other hand, Switzerland is optimistic about cooperating with global economic powers in order to agree on a framework for letting Facebook’s Libra to get the approval for its operation in the region. Switzerland’s Financial Market Supervisory Authority director Mark Branson said that Libra fits perfectly well into the regulatory framework of the country. His agency works as the top Swiss financial watchdog for the country and has consistently supported operationalizing Libra in the region after it has met the demands of regulatory agencies.
In conclusion, the situation for Facebook keeps getting precarious in Europe as more officials from the governments voice their concerns against the official roll out of the Libra cryptocurrency. Many cite its failure to meet the concerns of the regulatory authorities.
Facebook has been marketing Libra ambitiously and has vowed to address the growing concerns of the authorities in a bid to win their approval. However, a proper response from Facebook after the recent developments remains to be seen.