Cryptocurrency pursuits conducted without supervision are more concerning to Switzerland than Facebook’s Libra coin, Reuters reported on Tuesday (Oct. 1).
“I am much more nervous about projects which develop in a dark corner in the financial system somewhere, spread themselves out through cyberspace and one day are too big to be stopped,” Mark Branson, CEO of Swiss financial supervisor FINMA, said at a Bloomberg event in Zurich.
“Here is something which is being done transparently,” he said, referring to Facebook’s Libra, which will be closely regulated and subjected to anti-money laundering laws.
“We are not here to make such projects impossible. We will respond to them with an open mind, with an attitude that the same risks require the same rules. Our rules and standards are non-negotiable,” Branson said, per the Reuters report.
Facebook announced plans for a blockchain-backed cryptocurrency in June, with a target launch of June 2020. The social media giant formed the Libra Association based in Geneva, Switzerland to oversee the coin. It has the lofty aim of connecting the 1.7 billion people around the world without access to a bank account to digital payments at low or no cost.
Libra has since attracted a lot of high-caliber experts and big-name support. Mastercard, Visa, PayPal, Stripe, PayU, Andreessen Horowitz, Union Square Capital, Coinbase, Xapo, eBay, Uber, Lyft, Farfetch, Mercado Pago, Spotify and Vodafone are just a short sampling of the 28 founding members of the Libra Association. Most backers have also invested $10 million each.
Libra will be a stablecoin with its value pegged to the U.S. dollar, unlike crypto projects like bitcoin.
As big, bold and novel an approach Libra could be to building a banking infrastructure for the unbanked, naysayers have noted that it is poorly calibrated for the problem it proposes to solve, and regulators in the U.S. and around the world have been skeptical.