Singapore Central Bank: Concerns Over Facebook’s Libra ‘Not Trivial’

Singapore’s central bank has held discussions with Facebook about its upcoming libra cryptocurrency, Bloomberg reported on June 27.

Ravi Menon, the managing director of the Monetary Authority of Singapore, reportedly acknowledged libra’s potential benefits — such as making payments cheaper or supporting the unbanked — but said the regulator needs to understand exactly how the tech giant’s system will work.

As well as warning that it isn’t clear whether libra would offer a superior alternative to other electronic payment mechanisms, Menon said Singapore would be seeking assurances on security and privacy issues before making a regulatory decision. At a news conference, he added:

“The key challenge is to figure out the nature of the beast. What is it more like and which box we can put it into. At this point we are not sure yet.”

Menon also warned that the concerns raised by central banks worldwide are “not trivial.”

Facebook has been receiving some considerable pushback from regulators since unveiling the white paper for its long-awaited cryptocurrency.

Earlier this week, Bank of France Governor Villeroy de Galhau warned libra will have to comply with banking regulations in the country, and may need a license to operate.

It has also been confirmed that the United States House Financial Services Committee will hold a hearing about libra on July 17.

Meanwhile, the head of the German Federal Financial Supervisory Authority has urged governments and central banks around the world to work together in forming an international regulatory framework.