Cryptocurrencies such as Libra risk upsetting the world’s financial system if they are not regulated tightly, G7 finance ministers have warned.
According to Reuters, French finance minister Bruno Le Maire told a news conference on July 18 that the G7 “cannot accept private companies issuing their own currencies without democratic control.”
His remarks followed informal talks in Paris, where the Group of Seven expressed vehement opposition to the prospect of firms having as much power as countries in creating means of payment.
The ministers and central bank governors also warned:
“Stablecoins and other various new products currently being developed, including projects with global and potentially systemic footprint such as Libra, raise serious regulatory and systemic concerns.”
Benoit Coeure, a European Central Bank board member, had told the meeting that global stablecoins could boost competition in the payments sector, reduce fees for consumers and support greater financial inclusion. However, he warned that they could undermine efforts to clamp down on money laundering, terrorism financing and tax compliance.