Senate Releases Opening Statements on Libra Ahead of Senate Hearing
The United States Senate Banking Committee has released the opening statements of David Marcus, head of Facebook’s crypto wallet Calibra today, July 15. The statements come ahead of a hearing on the Libra cryptocurrency project tomorrow in the Senate, in which Marcus will testify.
Facebook has ‘a lot of work to do’ on crypto plans, Mnuchin says
“To the extent that Facebook can do this correctly, and can have a payment system correctly with proper AML [anti-money laundering measures], that’s fine. But we have got a lot of work to do to convince us to get to that place.”
Facebook tells Congress how it thinks Libra should be regulated
Facebook will not launch the cryptocurrency Libra until it has “fully addressed regulatory concerns,” according to David Marcus, the head of Facebook’s Calibra. The remarks are prepared testimony he plans to give tomorrow, in front of the US Senate Banking Committee.
Facebook’s proposed creation of Libra is a wake-up call. It makes inescapable the need for rapid, international coordination of financial regulation. Without mechanisms to ensure consistent application of coherent global rules, we may find ourselves in a world full of “low-quality finance havens” that exist to evade financial regulations—just like “tax havens” that exist merely to evade taxes.
Japan sets up working group on impact of Facebook's Libra ahead of G7
Japanese authorities have set up a working group to discuss the impact Facebook’s proposed Libra digital coin could have on monetary policy and financial regulation, government sources said, ahead of a G7 finance leaders’ gathering where the topic will be high on the agenda.
Digital upstarts need to play by the same rules as everyone else
The IMF is watching the growth of so-called stablecoins closely and today published a paper that identifies their benefits and risks, and highlights some regulatory issues that are likely to emerge.
U.S. proposes barring big tech companies from offering financial services, digital currencies
“A large platform utility may not establish, maintain, or operate a digital asset that is intended to be widely used as medium of exchange, unit of account, store of value, or any other similar function, as defined by the Fed.”
The Case for a New International Monetary System | Cato Institute
Trump Fed nominee Judy Shelton: "An approach that permits the issuance of virtual currencies in tandem with government-issued currencies, adapting legal tender laws to permit healthy currency competition—should be put forward."
Drafted “Keep Big Tech out of Finance” Act Surfaces Days Before Libra Hearings
A draft bill entitled “Keep Big Tech out of Finance” has surfaced online, allegedly deriving from within the United States House of Representatives Financial Services Committee. The document’s metadata dates it July 12.
Memo to the Members of the House Committee on Financial Services regarding the July 17, 2019 hearing entitled “Examining Facebook’s Proposed Cryptocurrency and Its Impact on Consumers, Investors, and the American Financial System.”
Staff at the US SEC are looking at whether Libra’s structure effectively makes it an exchange-traded fund, according to people familiar with the matter. If the SEC decided that Libra’s design makes it an ETF, Facebook would need the regulator’s approval to launch the project.
Having read many a hot takes on Libra, from supporters and straight up haters, I decided to craft a post to consider some of the lesser appreciated aspects around Libra, and more specifically the reserve mechanism that is envisioned to underpin its stablecoin.
Improving the Monetary Regime: The Case for U.S. Digital Cash
An urgent priority for the Fed and other central banks is to move ahead with the provision of digital cash as a means of mitigating the effective lower bound. This approach will ensure that monetary policy will be systematic, transparent, and effective during normal times and in responding to severe adverse shocks.
Should the Bank of Japan Issue a Digital Currency?
The BoJ is continuing to examine CBDC. Recent intiatives include continuing DLT research (eg Project Stella with the ECB) and an internal study group on potential legal issues around BoJ CBDC issuance (a report will be released in due course).
CBDC can leverage the decentralized and secure advantages of blockchain. This enables P2P transactions, offers a more resilient payment infrastructure, reduces transaction costs, enhances information sharing capabilities and facilitates data reconciliation. Blockchain enabled payment solutions have been rigorously tested by central banks across North America, Europe and Asia.
There’s a big problem with Facebook’s Libra cryptocurrency
Libra's future remains murky. Facebook is months away—at least—from actually launching a network. The documents Facebook released in June left a lot of unanswered questions about how the network will actually work—and in particular, how the network will deal with the wide range of legal and regulatory requirements that apply to payment networks.
Research Scientist, Calibra Economics (Blockchain) | Facebook
Facebook is seeking a professional researcher with a PhD degree in economics to “initiate and execute projects around topics such as auction design, economic incentives in consensus protocols, market concentration, and macroeconomic aspects of the Libra currency,”
Digital currencies: An exploration into technology and money
Former Banque de France deputy governor Jean-Pierre Landau argues that the network effects created by the aggregation of a vast range of activities in financial “platforms” create externalities very similar to those that underlie the creation of money. The report highlights three implications. First, the financial system could become “payment centric” – with bank deposits no longer the dominant form of private money. Second, digital interconnectedness may create around such networks digital currency areas, a development that could fragment some monetary systems. Third, national borders may not constrain such digital currency areas, and the currencies of those countries where digitalisation proceeds fastest (and where networks become the biggest) may become more widely used internationally – “digital dollarisation”.
President Trump Is the Latest Critic of Facebook's Libra
For the first time, it seems, a sitting US president has acknowledged Bitcoin as a threat. Ironically, this indicates progress for crypto. "First they ignore you, then they laugh at you, then they fight you, then you win." Mahatma Gandhi
Some Considerations on Central Bank Digital Currencies | Banco de Mexico
The number and nature of the pending question marks around CBDC underlines the relevance of continued efforts to satisfactorily understand this matter as well as its potential consequences... We are dealing with an issue with potential major implications and still many unknowns.
The Kenya Information Communications (Amendment) Bill, 2019 is seeking the registration of mobile money services as separate business units. It would compel the telecommunications regulator to ensure that mobile money services are licensed as banks.
The biggest threat to Facebook’s financial inclusion plans are the government authorities in those developing countries. Furthermore, individuals without access to bank accounts in those countries are typically those with bad credit history or those who fail to comply with AML/CFT/KYC requirements
Libra could face difficulty entering Thailand because the blockchain-integrated cryptocurrency does not fall under any type of financial legislation, according to a government legal expert.
Proposal for an IMF Staff Executive Board Paper on Promoting Market SDRs | The Bretton Woods Committee
This blog by ex-IMFer (1976-2003) Warren Coats suggests that the IMF get to work developing a digital SDR, to build the foundation on which the SDR can become a more important international reserve asset.
Metropolitan Bank Says It Shut Down Tether's Account After 5 Months
The NY Attorney General's office, which is embroiled in a legal battle with Tether Bitfinex, filed new documentation showing that Tether held accounts at Metropolitan Bank and Signature Bank, two crypto–friendly banks based in the state.
PBoC gets go-ahead from China’s cabinet to develop CBDC
China’s cabinet, the State Council, has given the go-head for the next stage of the central bank’s digital currency programme, according to Wang Xin, director of the central bank’s research bureau.
West Africa announces ambitious new ‘eco’ currency plans
The Economic Community of West African States (Ecowas) has adopted ‘eco’ as the name of its single currency, which it now plans to begin issuing in 2020.
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