Facebook has been criticized during the last month by many governments and regulatory agencies after announcing a new cryptocurrency project called Libra. This time, the head of Germany’s central bank Jens Weidmann defended Facebook’s project during an event hosted by the G7.
Germany Open About Facebook’s Libra Project
Weidmann, the president of the German Central Bank, explained that it is important not to suppress Libra’s project in its infancy since it can be positive for innovation in the financial world. According to an email newsletter that was shared by eToro senior market analyst Mati Greenspan, Jens Weidmann doesn’t understand the scepticism about Libra.
During a G7 meeting, Weidmann supported the Libra cryptocurrency project that is currently being developed by Facebook. During the last few weeks, many regulators from different countries were negative about Libra’s project and what Facebook is trying to do.
Facebook announced on June 18 a new cryptocurrency project called Libra that includes a digital currency backed by the U.S. dollar, the Japanese yen, the Euro and the British pound. That means that Libra is going to be considered a stablecoin with its price fluctuating according to the value of the underlying currencies.
The head of the Bundesbank seems to be positive about this development and urged the community to give time to this kind of initiatives.
According to the translation provided by Mati Greenspan, Mr. Weidmann commented:
“If they deliver what they promise, they can be attractive to consumers. […] Who wants to source must swim against the current.”
The digital currency is also expected to help individuals process transactions in a fast and easy way through the Calibra wallet, Facebook Messenger or WhatsApp. However, there is no specific launching date for the digital asset. Regulatory agencies from different countries want to regulate and control the cryptocurrency since Facebook has access to over 2 billion individuals.
The French finance minister Brune Le Maire said that the G7 is not going to be accepting private companies issuing digital currencies without creating a democratic control around them. Moreover, France has also decided to create a task force that is expected to be working on searching for regulations for this new project.
Although Weidmann is now more open towards Libra, he was very cautious with Bitcoin (BTC) and other digital assets claiming that they could pose risks to the world’s financial system.
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