Europe is ready to “prevent the development” of risky digital currencies including Libra until all concerns have been addressed, according to the latest proposal to be discussed by EU finance ministers and seen by EURACTIV.com.
Facebook’s project to launch a digital currency has sparked a global backlash since having been announced last year.
On Friday (8 November), EU finance ministers will discuss how to best respond to the myriad of challenges brought by this ‘stablecoin’, a digital token backed by sovereign currencies.
The latest draft text brings back the possibility of banning ‘global’ stablecoins that create “excessive risks”.
Member states say that “all options should be on the table including the possibility to take measures preventing the development of projects that would create unmanageable or excessive risks”.
The Brief, powered by BP – Facebook’s wake-up call for Europe
Facebook’s digital currency Libra, which some regard as a threat to the sovereignty of nations, could be blocked in the EU unless it meets new and stricter standards. But most importantly, the initiative could be a wake-up call for Europeans to rethink their money and payment systems for the digital era.
The latest text is in line with the initial draft document prepared by Finland’s rotating presidency of the EU, which already contemplates the possibility of taking measures that “would impede the development” of projects with “unmanageable risks”.
The latest draft included a new paragraph saying that Libra and similar projects “should not begin operation in the EU” at least until all the challenges and risks have been identified and addressed.
