- Facebook’s stablecoin, Libra, could have triggered a possible escalation of EU regulatory policies against cryptocurrencies.
- The multinational organization would be considering launching a digital Eurocoin.
A possible new European Union resolution could complicate operations for the cryptomarket. According to Reuters, the agency could be in the process of implementing a harder-line policy against cryptocurrencies.
The Facebook Libra would have been the main trigger for the EU’s potential hardening in terms of its policy against cryptocurrencies. It would be another of the barriers that Mark Zuckenberg’s company will have to face after its main partners abandoned the project.
European Union and its war against cryptocurrencies
The new resolution would still be under review. However, if approved, it is expected to be issued before the end of the year. The initiative would have been taken by the current presidency of the body, led by Finland. Its implementation would represent a new obstacle to the adoption of cryptocurrencies, such as Bitcoin, in European countries.
Apparently, the regulations that would seek to be apply have arisen due to the effect of Facebook’s proposal for a stablecoin, Libra. Members of the multinational organization would have realized the potential of stable coins and the threat they could pose to the global economy if billions of people adopted Libra.
In addition to arguing that Facebook’s stablecoin could be used for money laundering, tax evasion, digital security and other criminal activities. The potential of the Facebook Libra has been recognized. For that reason, in this same document, the development of a digital Eurocoin is suggested:
The ECB and other EU central banks could usefully explore the opportunities as well as challenges of issuing central bank digital currencies including by considering concrete steps to this effect.
The objective would be to exploit, regulate and control the market and the potential of stable coins.
The policies of the European Union have so far been adopted unevenly. In Italy, for example, there has been a significant adoption of Bitcoin as a method of payment. However, a possible resolution of the kind proposed in the document could cause all its members to perceive cryptocurrencies as “hostile assets”, dangerous to national security.
Could Facebook’s Libra be a global danger?
The Facebook project has seen growing opposition. It has come up against a lot of obstacles and pressures from world governments, arguing that Libra carries a lot of risks. A possible ban on the project as a whole is not ruled out. At least until all variables are clarified according to the EU.
It is clear that the organization and some of its members have become aware of the power that cryptocurrencies can have and how they could take power away from the central banks of each country. If their policies and the control they exercise over national currencies are no longer effective, the global governments could be unable to predict the effects that this could cause.
In any case, if these policies go into effect, the EU could have regulations just as tough as the United States. A policy that, according to Mike Novogratz, will make companies and startups prefer to migrate to friendlier markets. For example, the Chinese who, as CNF has reported, is on the way to opening his country to cryptocurrencies and blockchain technology.