Group of Seven finance ministers and central bankers said digital currencies need to be closely regulated so that they don’t disrupt the global financial system.
Finance Minister Bruno Le Maire of France, which holds the current presidency of the G7 top world economies, said that the group opposes giving companies the same privilege as nations when it comes to creating payment methods without being subjected to any control and obligations, according to Reuters.
“We cannot accept private companies issuing their own currencies without democratic control,” Le Maire said in Reuters.
He added that the ministers and governors had agreed that “stablecoins and other various new products currently being developed, including projects with global and potentially systemic footprint such as Libra, raise serious regulatory and systemic concerns.”
As for Facebook’s upcoming launch of its own cryptocurrency, the G7 said it is worried that Libra might weaken their control over monetary and banking policies, as well as create security risks.
“A global stablecoin for retail purposes could provide for faster and cheaper remittances, spur competition for payments and thus lower costs, and support greater financial inclusion,” European Central Bank board member Benoit Coeure, the chairman of the taskforce, told the G7 meeting.
“However ... they give rise to a number of risks related to public policy priorities including anti-money laundering and countering the financing of terrorism, consumer and data protection, cyber resilience, fair competition and tax compliance,” he added.
The G7 also agreed that large tech companies, including Google, Amazon, Facebook or Apple can be taxed in the countries in which they make money but do not have a physical presence. They also agreed that there should be a minimum level of tax so that companies don’t engage in a “race to the bottom” to attract business from digital multinationals.
“A minimum level of effective taxation, such as for example the U.S. GILTI regime, would contribute to ensuring that companies pay their fair share of tax,” the chair summary said.