Amidst all the criticisms about Facebook from financial institutions worldwide, a report from Reuters reveals that Facebook did seek regulatory counsel and had discussions with British financial regulatory officials, and even central banks, as early as April this year prior to its reveal in June.
A spokeswoman from Facebook said Facebook met officials from the British finance ministry on 23 April to discuss policies regarding cryptocurrency. They also spoke to the Financial Conduct Authority (FCA) about the Libra project specifically.
Regulators’ concerns with regards to the danger of Libra being used for illegal and criminal activities, the inability of Facebook to guarantee the security and privacy of its users and the possibility of Libra disrupting current financial ecosystem, are not unfounded. Facebook has a history of data breaches, which adds to concerns that Libra may not be as safe as its founders claim it to be.
Currently, it is unclear if Facebook intends to formally obtain approval from Britain for Libra. It has applied for a payments systems license from the Swiss Financial Market Supervisory Authority (FINMA) in Switzerland. The license will take eight to twelve months to process., but Swiss financial authorities are also being very cautious towards Libra and its developments.
Mark Carney, the head of the Bank of England, has also been more positive in his comments about Libra as compared to his counterparts in Europe. Britain expects to benefit from the digital currency; however, everything needs to be transparent and private and standardised.
