Swiss President Says Facebook’s Libra Has ‘Failed’ In Current Form

Facebook’s Libra cryptocurrency has “failed” in its current form and cannot be approved by financial authorities without changes, according to the president of Switzerland, where the Libra Association is based and is seeking regulatory consent.

“Central banks will not accept” the basket of assets underpinning Libra, Ueli Maurer, Switzerland’s finance minister and outgoing president, told Swiss broadcaster SRF.

“Switzerland cannot grant Libra a permit in its current form,” he added, according to local media reports.

He told Reuters that “the project, in this form, has thus failed”.

Banking revolution

Maurer added that projects such as Libra were likely to “shake up” the banking system as it exists today, making banks unecessary for some transactions.

Libra did not immediately respond to a request for comment.

Facebook announced Libra earlier this year, with plans to launch the cryptocurrency in June 2020.

But the project has raised concerns from regulatory authorities and governments ranging from its impact on privacy or financial stability to concerns over money laundering.

Regulation

Libra officials, including Facebook’s David Marcus, have said regulatory hurdles could delay Libra’s launch date.

The cryptocurrency is to be backed by assets including bank deposits and government debt in order to avoid the sharp price swings that have affected other digital coins.

Switzerland has been broadly receptive to start-ups involving blockchain and cryptocurrencies, which may account for Facebook’s choice of Geneva for the Libra Association’s headquarters.