Facebook’s Libra cryptocurrency stumbled upon a new obstacle on Thursday. The G7, an international intergovernmental economic organization, said that digital currencies like Libra should be launched only after verifying if they are posing any intense threat to the world.
The group of seven advanced economies said in a report for finance ministers, that the worldwide launch of the cryptocurrency could potentially pose a negative impact on the financial and monetary system.
According to the report, digitally advanced but uncontrolled stablecoins could also become a hindrance in the international movement against terror financing and money laundering. It could also create acute concerns for overall security, taxation, and cyber-security as well.
The task force of the G7 said that any digital currency like Libra or others should not initiate their operations before they are declared harmless in terms of legal and regulatory conditions.
Stablecoin, introduced by private organizations, is anticipated to create severe regulatory and legal threats and challenges, the report added. It also highlighted crucial problems for policymakers regarding the digital currency.
Libra cryptocurrency is committed to sticking to the regulations, Facebook replied in the G7’s statement. Libra always aims to respect the monetary and financial system, it will never create any issue for the regulatory system that works against complications such as money laundering and illicit finance, the social media platform added further.
Facebook-backed cryptocurrency is established to comply with current regulatory institutions and not to convulse or perform against them.
Facebook said that stablecoin is designed with core objectives to control the intense fluctuations in the cryptocurrency market.