European Central Bank: Libra and other stable currencies have not undergone large-scale testing, which will bring serious risks

According to Reuters, the European Central Bank (ECB)'s Benoit Coeure warned of the risks of "stabilized coins" such as Libra.

As a member of the board of directors of the European Central Bank, Coeure told central bank officials from the Basel International Bank of Real Estate (BIS) that these new virtual currencies were largely untested and promised to impose stringent regulatory measures on them.

Although cryptocurrency has been born for more than a decade, the bitcoin-dominated digital currency is still a largely unregulated and opaque industry that provides users with near-anonymous services and engages in hacking, robbery and hacking for some lawless elements. Illegal activities facilitate.

The stable currency is supported by assets with real value, unlike the pure cryptocurrency. The most famous of these is Facebook's cryptocurrency Libra, which is backed by assets such as traditional currency deposits, short-term government securities or gold.

But since the white paper was announced in June this year, Libra has been questioned by governments, central banks, and legislative and regulatory agencies that are thought to have a destabilizing effect on the global financial system and used for money laundering. Coeure, as chairman of the BIS Payments and Market Infrastructure Committee, said at the event,

“Stabilized coins are largely untested, especially at the scale required to run a global payment system. They bring many serious risks associated with public policy priorities. Regulators need to use high approval standards. ”

On Friday, French and German finance ministers said at the euro zone finance ministers meeting that Libra and other cryptocurrencies pose risks to consumers, financial stability and even currency sovereignty.

A spokesperson for the Libra Association, which manages Libra's cryptocurrency, said the event in Basel was "constructive" and said the association is committed to working with central banks and regulators to achieve its stable and low-cost payment system. The goal.

The spokesperson said, “We recognize that blockchain is an emerging technology and policy makers must carefully consider how their applications fit into financial system policies.”

After Coeure's speech, Facebook blockchain owner David Marcus issued a tweet saying that Libra would not pose a threat to countries' power to control monetary policy. He said that Libra's design goal is a payment network operated on an existing currency basis. No new currency is created and it will not pose a threat to the sovereignty of the country.

Image source: pixabay

By Xiu MU

This article comes from the push bitpush.news, reproduced need to indicate the source.

We will continue to update Blocking; if you have any questions or suggestions, please contact us!

Share:

Was this article helpful?

93 out of 132 found this helpful

Discover more

Blockchain

The user information of the currency circle has been leaked on a large scale, and the fire currency and the currency security have issued risk warnings one after another.

On August 6th, a large number of users of the currency said that they received a call from a customer service company...

Opinion

Web3 Public Legal Education | Why is it best for blockchain startups to not issue tokens?

If traditional internet entrepreneurship is considered a high-risk endeavor, then starting a business in blockchain i...

Blockchain

Deep analysis of the intent behind SEC's lawsuit against Binance: a jurisdictional dispute or a show of power?

Some observers believe that the SEC may be suing Binance to compete with the Commodity Futures Trading Commission (CF...

Blockchain

Gu Yanxi: The Governance Mechanism of the Future Encrypted Digital Asset Trading Industry

More and more encrypted digital asset exchanges have emerged in the US market recently. In addition to existing encry...

Blockchain

Research Report | Exchange Industry 2019 Q1 Report

In the first quarter of 2019, the digital clearing exchange industry changed dramatically. After a long bear market i...

Policy

The Crypto Circus: A Bug’s Billion-Dollar Bonanza

During the 10th day of Sam Bankman-Fried's trial, talks focused on a software glitch and the allocation of funds for ...