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Swiss Crypto Regulators Still Waiting to Hear from Facebook about Libra

SubverseJul 22, 2019, 5:53:03 PM

By Sean Jackson 

Last month, Facebook announced its intention of releasing its own coin on the blockchain along with a council of other companies. The response has been varied, with many voicing concern over the company’s previous scandals relating to data privacy.

The announcement of Libra included information that the conglomerate of companies involved will be meeting and running the coin out of Switzerland. However, Facebook has yet to contact with Swiss regulators about registering the cryptocurrency project.

Just last week, Calibra Chief David Marcus vowed to work with lawmakers during his testimony in front of the Senate Banking Committee. The committee sought more information on how a privately owned currency could affect U.S. economics. During the hearing, Marcus said Calibra will be operating out of Switzerland, stating, “For the purposes of data and privacy protections, the Swiss Federal Data Protection and Information Commissioner will be the Libra Association’s privacy regulator.”

The Head of Communications at the Swiss Federal Data Protection and Information Commissioner, or FDPIC, Hugo Wyler told CNBC, “We have taken note of the statements made by David Marcus, chief of Calibra, on our potential role as data protection supervisory authority in the Libra context. Until today we have not been contacted by the promoters of Libra.”

Wyler added, “We expect Facebook or its promoters to provide us with concrete information when the time comes. Only then will we be able to examine the extent to which our legal advisory and supervisory competence is given. In any case, we are following the development of the project for public debate.”

While Facebook may have not made full contact with Swiss regulatory agencies, the country is seemingly far more attractive for companies looking to start cryptocurrencies. Switzerland’s cryptocurrency laws have similarities to those in the United States, but a far more welcoming attitude than the skepticism among U.S. lawmakers.

In both countries, laws allow digital currencies and exchanges, protect citizens from illicit activities such as laundering and extortion, utilize existing financial legislature in conjunction with cryptocurrencies, and are still open to finding the best way to regulate digital currency.

However, Switzerland chooses to have flexibility in terms of governing new types of currency, attempting to take a far more case-by-case approach to how ICOs and crypto are regulated.

President Donald Trump used Twitter to speak about bitcoin, taking a far more regulatory stance, stating, “I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air. Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity… Similarly, Facebook Libra’s ‘virtual currency’ will have little standing or dependability. If Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks…”

While Calibra will have its share of obstacles when it comes to the volume of criticism it receives, the lack of contact with Swiss regulators may become another hurdle before Libra’s launch in 2020.