France says it will block Facebook’s Libra cryptocurrency in the EU

France says it will block Facebook’s Libra cryptocurrency in the EU

Facebook’s “Libra” cryptocurrency project faced another policy setback on Thursday, with France saying that it would block its implementation in the Europe, according to BBC News.

The nation’s finance minister, Bruno Le Maire, voiced concerns over how the currency could allow Facebook to abuse its dominant position in the market, would threaten the monetary sovereignty of nations, and carry risks for consumers.

“All these concerns about Libra are serious. I therefore want to say with plenty of clarity: in these conditions, we cannot authorize the development of Libra on European soil,” he said Thursday, criticizing the move toward “eventual privatization” of money. 

It’s not the first roadblock Facebook has faced with Libra. The tech giant announced plans for cryptocurrency in July, and was immediately confronted with criticism from regulators. The US Congress asked it to pause development while they investigate the potential implications of a currency linked to a social media platform that’s “already in the hands of over a quarter of the world’s population.”

And earlier this week, Switzerland said the project could be subject to special rules that normally apply to banks. Unlike other decentralized cryptocurrencies, Libra would be managed by a non-profit association based in Geneva, called the Libra Association. 

Bank of England chief Mark Carney has voiced concerns over the project, and US President Donald Trump has said he is “not a fan.” 

The European Commission responded to Le Maire’s comments, saying it will look closely at the ramifications of the project, in terms of everything from tax questions to data privacy.

The commission’s spokesperson, Vanessa Mock, said:

“It’s likely that once we know more the contours of the currency, the project will require some form of authorization in Europe. Then it would be up to the Libra association to contact relevant authorities – be they national or at EU level – to obtain the necessary licenses, if needed, before launching in the EU.”

The commission has announced plans to launch an antitrust investigation into the project. 

Facebook has argued that Libra would make affordable financial services available to people without bank accounts. It would also allow Facebook to offer its own financial services and help more small businesses to take out ads on the platform. 

According to the Libra Association’s head of policy and communications, Dante Disparte, France’s concerns highlight the need to work closely with regulators toward a “safe, transparent and consumer-focused implementation of the Libra project.”

Photo by Image by Gerd Altmann from Pixabay