Crypto Libra Under Regulatory Microscope

Governments are taking a hard look at Facebook’s proposed cryptocurrency Libra.

Facebook Libra Virtual Currency : Illustration

They fear that it will endanger consumer privacy, threaten fiat currencies and give Facebook too much power over the financial system.

The Securities and Exchange Commission is pondering whether Libra would actually be an exchange traded fund subject to the SEC’s regulation. President Trump tweeted recently that Facebook should get a bank charter and be regulated by the Office of the Comptroller of the Currency, the Federal Reserve Board and the FDIC.

There are significant issues for the cryptocurrency, including how the Libra Association will earn interest on all deposited fiat money, how the governments could track transactions to prevent money laundering schemes, whether Libra could have a negative effect on volatile or weak fiat currencies and whether it could be used to finance terrorism, drug dealing or other nefarious industries.

A 2018 study from the University of Technology Sydney found that about a quarter of bitcoin users, and nearly half of all bitcoin transactions, are involved in illicit activity.”

https://www.washingtonpost.com/business/2019/07/12/why-governments-around-world-are-afraid-libra-facebooks-cryptocurrency/?noredirect=on&utm_term=.dfd695d4f6b0

Advertisements

About JeffKoeppel

I am a corporate/securities attorney in the Washington, DC area. Prior to joining the firm, I was a Senior Attorney Advisor in the Division of Corporation Finance at the U.S. Securities and Exchange Commission. I am a member of the Bars of the States of Maryland, New York and the District of Columbia. You can also follow this blog on LinkedIn at: http://www.linkedin.com/pub/jeffrey-a-koeppel/0/63/5a9
This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.