While Facebook’s cryptocurrency initiative is criticized all around the world, policymakers in Geneva are bullish on the social media company’s move.
Facebook has set up its Libra Association, a non-profit body which is about to govern its cryptocurrency, in the city of Geneva. The Swiss State Secretariat for International Finance said it’s a “positive sign that Switzerland can play a role in an ambitious international project.”
Switzerland is known as the paradise for the banking sector for its minimum regulatory interference on the industry. Though the country did not attract many technology companies over the decades, it has seen an influx of blockchain companies over the past few years. The city of Zug also earned the title of “crypto valley” for being the home to many crypto-related companies.
Backed by a basket of fiat bank deposits and short-term government securities, Facebook is trying to capture the remittance market with its digital currency. Moreover, with 2.28 billion users alone on its main social media platform, the company is bullish to achieve its goals quickly. Facebook is also planning to introduce the currency on its other platforms – WhatsApp and Instagram – which have 500 million daily and 1 billion monthly users, respectively.
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The social media company is also in talks with the FINMA, the Swiss financial market regulator, to evaluate if the digital currency needs any regulatory approval in the region.
“Finma deserves a lot of credit for being very pragmatic and patient in the way they have been approaching the subject,” John Hucker, the president of the Swiss Finance & Technology Association, told Bloomberg.
Hostility on rising
Meanwhile, in the United States, both the Senate and the House have scheduled hearing dates to examine the privacy issues of the social media giants cryptocurrency. The head of the House committee even urged the company to halt its digital currency development.
“We’ve got to protect our consumers. We just can’t allow them to go to Switzerland with all of its associates and begin to compete with the dollar,” Rep. Maxine Waters told CNBC.
French finance minister Bruno Le Maire is critical on the uses of the digital currency of the company and believes that “it is out of [the] question [for Libra to] become a sovereign currency,” and called for an examination on the company’s plans.