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ECB Board Member Criticizes Stablecoins, Seeing Them as a Risk to Public Policy

17 September 2019 11:58, UTC

Benoit COEURE, member of the board of the European Central Bank (ECB), states that stablecoins pose a risk to public policy priorities while commenting on the initiatives of Facebook Libra launch. A comment on the regulation of stablecoins was made at the meeting at the Bank for International Settlements (BIS) in Basel, Switzerland, Reuters reports:

“Stablecoins are largely untested, especially on the scale required to run a global payment system. [...] They give rise to a number of serious risks related to public policy priorities. The bar for regulatory approval will be high.”

The event at the BIS was attended by 26 global central banks and the Libra project team with the agenda of assessing the risks of project’s financial stability. This event was reportedly the first major meeting between the founders of Libra and world politicians after Facebook announced its plans for the project on June 18.

Benoit COEURE has previously noted that Libra will not be released until global regulators are satisfied — the proposed stablecoin should be guaranteed to be safe for users, and this process may require lengthy discussion and consideration by regulatory authorities.

In his speech, Calibra CEO David MARCUS responded to claims from regulators, arguing that the Libra project does not intend to generate a new currency, but rather builds "better payment network and system running on top of existing currencies."