Facebook is about to undergo scrutiny even further over its cryptocurrency project dubbed Libra. The Zuckerberg-owned company has been through a lot for months and is about to answer some really difficult questions. Reportedly, Libra representatives will be meeting officials from 26 central banks. This includes the Bank of England and the US Federal Reserve in Basel, Switzerland today.
Chairing the gathering will be the European Central Bank’s Benoît Coeuré that will be questioning Facebook over the digital money’s “scope and design”.
Libra did agree to the call, reiterating with its first stance that it “welcome[s] this engagement” with politicians and regulator. Moreover, Libra “deliberately” set out a long launch schedule to discuss issues and modify its plans based on feedback.
But with the conversation not expected to go Facebook’s way, Benoît Coeuré has warned that the company has a” very high” bar to clear. This is especially after worries from EU finance ministers that currencies like Libra could destabilize the global financial system.
France and Germany argue Libra should be blocked in the EU as it would challenge the “monetary sovereignty” of governments. On the other hand, Facebook has been pitching Libra as a way to democratize money, providing banking to many first-timers. This is of course alongside creating a format that’s independent of any one country.
And if you’ve been following, you know it’s the last bit that has everyone worried. The tremendous amount of clout that Facebook might gather is what’s taking people off. It may not have much choice but to make concessions if it wants the currency to be widely available.