Facebook reportedly met British authorities and regulatory officials three times prior to publicly announcing plans for the Libra stablecoin project.
As Reuters reported on Sept. 18, this spring Facebook had several appointments with officials at Britain’s finance ministry, the Financial Conduct Authority and the Bank of England. Reuters received details regarding the meetings after submitting freedom of information requests.
At the meetings Facebook discussed its forthcoming digital currency Libra in a bid to get support from authorities before the official announcement.
Libra’s attempts to get regulatory approval
Libra has been actively trying to get approval from regulators around the world and has pledged not to launch until regulators are appeased. A Facebook spokesperson told Reuters:
“Engaging with regulators, policymakers, and experts is critical to Libra’s success […] This was the whole reason that Facebook along with other members of the Libra Association shared our plans early.”
Bank of England governor Mark Carney previously argued that Libra, due to the massive scale of the project, has to be virtually perfect at the outset in order for it to be released at all. “It’s either successful or it isn’t. If it’s successful, it becomes systemic, because it would involve a very large number of users. And if you’re a systemic payment system, it’s 5-sigma,” Carney said.
After Facebook introduced the white paper for Libra earlier this year, United States Representative Maxine Waters requested that Facebook halt its development while authorities investigated the project and its possible effect on the economy and U.S. monetary policy.
David Marcus, the head of Libra’s associated wallet Calibra, subsequently stated that Libra would not launch before they address all regulatory concerns. Marcus also stated that he believes they can improve the current system in order to preclude wrongdoers from using Libra for illicit activity.
Switzerland’s openness to Libra regulation
The Libra Association, of which Facebook is a member, is seeking a payment system license under Switzerland’s Financial Market Supervisory Authority (FINMA) for Libra.
FINMA later said that it is open to international cooperation and oversight of the way in which it regulates the planned cryptocurrency network. FINMA director Mark Branson noted that FINMA does not need foreign pressure to recognize the major challenges that a project of Libra’s scale poses for regulators. Branson said:
“It was crystal clear from the start that this project could have huge dimensions and implications.”