FILE PHOTO: A small toy figure stands on representations of virtual currency in front of the Libra logo in this illustration picture, June 21, 2019. REUTERS/Dado Ruvic/Illustration
FRANKFURT (Reuters) – Global financial regulators have no plan to ban Facebook’s Libra or other stablecoins, but these digital tokens backed by official currencies will have to meet the highest regulatory standards, European Central Bank director Benoit Coeure said in an interview published on Thursday.
His comments provide a rare ray of light for Facebook’s cryptocurrency plans, which have been widely criticized by regulators and politicians since the social media group unveiled the currency in June.
“There is certainly no judgment that stablecoins shouldn’t exist,” Coeure told Bloomberg News.
European policymakers have voiced strong opposition to Libra, with France pledging to block its launch in Europe over worries about its impact of financial stability and its potential to undermine monetary sovereignty.
But Coeure, who is French, was more constructive.
“In the case of Europe, neither the Commission nor the ECB intend to make Europe a no-fly zone for stablecoins. But stablecoins will have to meet the highest regulatory standards and adhere to broader public policy goals,” he said.
Libra’s backers pledged to forge ahead with the project on Monday, shrugging off the defection of seven of its founding members, including major payments firms Visa and Mastercard, amid the regulatory criticism.
Libra said the digital currency’s regulatory issues could push back its launch date, planned for the end of June next year.
On Thursday, Coeure is due to present the recommendations of a G7 taskforce on stablecoins to finance ministers from the world’s seven largest economies gathering in Washington for the International Monetary Fund’s annual meetings.
Reporting By Francesco Canepa; Additional reporting by Thomas Wilson in London; editing by John Stonestreet and Jane Merriman