Australia could regulate Libra, the controversial stablecoin of the giant social network.
According to a recent document issued by the Australian Prudential Regulation Authority (APRA), the agency could “potentially” regulate the stablecoin project.
APRA, one of the main financial regulators in the country, yesterday presented a regulatory proposal to the Senate that focuses on fintech and other financial mechanisms. The regulatory framework proposed by the agency includes a chapter dedicated to digital wallets and makes several references to the Facebook project. According to the document:
“The role of APRA in the framework would be to monitor the portfolios that are widely used as a means of payment and store significant value for a reasonable amount of time (for example, potentially the proposed Calibra wallet from Facebook).”
Australia could regulate Libra
For its part, in the document, APRA recognized the importance of digital wallets within the current financial system. This due to the increasing popularity of mobile applications and online shopping. Even so, the regulator distinguished between two different types of different digital wallets. According to the distinction, the entity only seeks to regulate those wallets that store digital currencies, such as Calibra; while excluding wallets that are mainly used as payment gateways, such as Apple Pay.
Australia seems to be moving towards the future of the global financial system, an advance that could prove positive for Libra. In the document, the regulatory entity states:
“The new framework is intended not only to be suitable for the purpose of the current financial system, but also to adapt to future developments and technological advances, such as proposals for global stablecoins ecosystems that have been the subject of significant attention in recent months.”
Stand firm regulators against Libra
Since its announcement in June last year, Facebook’s cryptocurrency project has faced comprehensive review by regulators around the world. And as time goes by, Libra seems to face more and more rumors that the project might not launch this 2020, as planned.
Last year, the Libra Association decided to settle in Switzerland, a country known to Blockchain enthusiasts for its favorable stance towards financial innovation. At that time, the Geneva authorities received the Facebook project warmly. However, regulatory authorities in different countries do not seem so receptive. US politicians expressed their concern last year that Libra would challenge the supremacy of the US dollar; while the French finance minister said stablecoin would challenge the monetary sovereignty of countries.
In December last year, Swiss Finance Minister Ueli Maurer said the country cannot approve Libra in its current form. Maurer went further and said the project “has failed” and doubts its launch “because central banks will not accept the currency basket that supports it.”
However, the media Bloomberg recently reported on a memorandum from the Swiss government that emphasizes that the country’s regulators have not ruled out the possibility that Libra can receive its approval. According to the report, Swiss officials will continue to monitor the project, paying special attention to “the way Libra can take in the future.”
Amid all obstacles, the Libra Association to remain optimistic about the project and its launch as planned. According to DiarioBitcoin, the Libra Association formed a “Technical Management Committee” formed by five members this January to oversee the development of the stablecoin project.