ECB says Libra could be 'wake-up call' for central banks

09 Jul, 2019 | Updated: 09 Jul, 2019
by Manshi Soneji Mamtora
ECB says Libra could be 'wake-up call' for central banks

According to a report by Bloomberg, executive board member of the European Central Bank, Benoit Coeure suggested that the regulators should be fast paced in establishing rules for giant teach firms entering the finance space. 

A wake-up call

As Facebook is coming up within the financial space introducing 'Libra' cryptocurrency, Coeure mentioned that this could be a 'wake-up call' for the public authorities as well as financial regulators.  

He says in Aix-en-Provence in southern France, ''It’s out of the question to allow them to develop in a regulatory void for their financial service activities because it’s just too dangerous. We have to move more quickly than we’ve been able to do up until now.”

Coeure mentioned that digital currencies are exposing insufficiencies in existing regulation and the failure of the banking system to adopt new technology. These cryptocurrencies would require regulators to improve the way they do things.

Other Central Banks

Major of the world financial regulators are scrambling to give a reaction for Libra. It seems that over a billion Facebook users could pose a threat to fiat currencies as the popularity of facebook worldwide is escalating.

Bank of England's Governor Mark Carney approaches it 'with an open mind but not an open door', suggesting some concerns there. Nations like France, Japan, Singapore have also expressed some interest over the need to know more about the Libra project.

French Finance Minister commented,  “it is out of question’’ that Libra be entitled to “become a sovereign currency. It can’t and it must not happen.”

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