G7 Regulators Call for Greater Oversight Over Libra

October 14, 2020 04:41 PM
Crypto story of the day

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Crypto was unchanged today as bitcoin now threatens a break beyond USD 11,500. Spot volumes are down and only approximately 75% of the 30-day average.

Crypto Story of the Day

In what could be an official obituary, the G7 regulators have opposed Facebook's controversial Libra project. This may be the last time we write about this major strategic blunder by one of the world's top technology firms.

Reuters first reported that G7 Finance Ministers opposed the coin until it was, “officially regulated.” A draft of the decision noted, "The G7 continues to maintain that no stablecoin project should begin operation until it adequately addresses relevant legal, regulatory, and oversight requirements through appropriate designs and adhering to applicable standards."

The G7's statement comes more than a year after the announcement of Libra in the spring of 2019. The project on launch was labeled a game-changer for digital payments and crypto by mainstream media. That came to a sudden halt, however, amid a massive push-back from regulators and legislators denouncing the concept of private currencies. Mark Zuckerberg would testify before Congress on the project before the company began to walk its ambitions back to the point that Libra is now barely recognizable from when it was first discussed.

When the Libra white paper was first released, we felt as though there were a myriad of philosophical and technical questions around the project that were completely unanswered and we were skeptical the token/protocol would ever launch. We were most surprised, however, that Facebook would try such a project launch, which would clearly be hot-politically, while already being investigated for privacy-scandals. Furthermore, that Facebook would describe Libra, which was if-anything a payment network, as a crypto-currency. We noted that while Libra was never a cryptocurrency, it certainly was the most politically-charged way to describe the project. Surely, the Libra rise and fall will be a business case studied for some time. We will remember this failure as a blunder by Facebook in their first real foray into financial services.

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