Can Libra survive the Tokyo Drift?
It has been a little over a month since Libra was unveiled and yet, it seems to have been a lot longer. The litany of reports, concerns, hearings and reactions from lawmakers regarding Libra is certainly entertaining for the cryptocurrency community, but it does pose an interesting question – What will be the large-scale impact of Libra on the domestic economy?
Well, it looks like one country wants to seriously address this question, rather than throw around blanket bans. According to Reuters, sources within the government have suggested that the island country of Japan will set-up a working group to ascertain the impact of Libra on the country’s “monetary policy and financial regulations.”
Interestingly, the timing of the creation of the working group is telling. It is nuzzled between the US Federal Reserve Chairman’s hearing on Libra before the US Congress and the G7 Finance Ministers and Central Bank Governors meet in Chantilly, France on the 17th and 18th of July.
The report stated that the working group will be constituted by representatives of the central bank, the Bank of Japan [BoJ], the Ministry of Finance, a cabinet-level ministry within the government, and the top regulatory body, the Financial Services Agency [FSA].
Additionally, the trio of government bodies have already commenced with meetings and will “seek to coordinate policies to address the impact Libra could have on regulation, monetary policy, tax and payments settlement.”
Tokyo hopes that the working group can expand beyond Japan and can include other countries and their tax and financial regulatory bodies as well, given the sheer size and scale of the Facebook cryptocurrency project.
The officials added that Japan will look to use its position as chair of the G20 to “align” the efforts of the G20 and G7 countries to “address the policy implications of Libra.”
Libra was the talk of the town at last month’s G20 Summit in Osaka, Japan. The representatives stated that they were closely monitoring developments in the cryptocurrency world and the larger implications it could have on the global economy.
From the United States to France, from the EU to Australia, regulators and lawmakers the world over have expressed their concerns about Libra. Earlier this week Jerome Powell, Chair of the Federal Reserve, stated that Libra ‘cannot go forward’ until ‘serious concerns’ around money laundering, privacy and financial instability are addressed by Facebook, a claim that got wider support from other US Congressmen.
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