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Europe should ignore 'treacherous promises' of Facebook's Libra currency: ECB's Mersch

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FRANKFURT - Facebook's proposed Libra currency could undermine the European Central Bank's ability to set monetary policy and Europe should ignore its siren call of "Treacherous promises" ECB board member Yves Mersch said on Monday.
Facebook announced Libra - a new digital coin backed by four official currencies and available to billions of social network users around the world - earlier this year, saying it hoped to launch next year.
"Depending on Libra's level of acceptance and on the referencing of the euro in its reserve basket, it could reduce the ECB's control over the euro, impair the monetary policy transmission mechanism by affecting the liquidity position of euro area banks, and undermine the single currency's international role," Mersch added.
Like regular currencies, Libra would be highly centralized, an "Extremely concerning" setup since it is not backed by a lender of last resort and it is ultimately accountable to shareholders, who are not seen as repositories of public trust, Mersch added.
Given these challenges, European regulatory and supervisory authorities need to assert jurisdiction over Libra and also need global cooperation to mitigate its risks.
"I sincerely hope that the people of Europe will not be tempted to leave behind the safety and soundness of established payment solutions and channels in favor of the beguiling but treacherous promises of Facebook's siren call," Mersch added.
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Which Currencies Will Back the Facebook-Led Libra Cryptocurrency?

Which Currencies Will Back the Facebook-Led Libra Cryptocurrency?


As expected, Facebook has been pressured to reveal more details about its controversial digital currency Libra after a series of meetings with high-ranking central bank officials and governments which deemed Facebook’s new crypto venture as ‘vague’, pointing that it lacks important documentation.
According to European officials, Facebook’s cryptocurrency project poses serious threats to the economic sovereignty of powerful countries such as France and Germany and therefore it should be examined in detail, as cited by the French minister of finance Bruno Le Maire.
In a letter to German parliament member Fabio de Masi, Facebook describes that almost half of the Libra digital currency would be backed by US dollar reserves, while national and regional currencies such as the Euro, the British pound, the Japanese yen, and Singapore’s dollar would also provide support and stability.
In addition. Facebook says that backing Libra with traditional currencies is a key element to help solve the problem of price volatility, as seen in cryptocurrencies such as Bitcoin BTC, -2.11% and Ethereum ETH, -2.12%.
An important observation is that the Chinese yuan, the currency of the world’s second-largest economy, is absent from the list.
Whether it’s a Trump’s trade war-oriented strategy or the fact that China has already developed its own digital currency that will be backed by the local yuan, expected to be launched later this year, Facebook seems to ‘target’ national currencies before it’s even deployed.

Libra has no shortage of critics

European Central Bank official Yves Mersch, who called Libra a ‘cartel-like’ operation during his speech at the ESCB Legal Conference earlier this Summer, says that Libra will be able to manipulate the pairing price with national currencies, and even shorten or pump the demand for a specific currency.
The Libra Association’s plan is to launch Libra sometime in 2020, despite the negativity received by the project from financial policy-makers and regulators all over the world.
Considering that the governing body behind Libra consists of telecom and tech giants such as Facebook, Mastercard, Visa, Paypal and others, it is not hard to imagine Libra catching on. Facebook alone reaches billions of active users across the globe.
Governments are naturally scared of a combination of forces of that magnitude, and therefore they see Libra as a threat to the current economic system.
On the other hand, Facebook keeps claiming that it welcomes feedback and discussion from global financial regulators, and are willing to address any concerns regarding the digital currency.
During a meeting that took place last week in Switzerland, Calibra head David Marcus tried to clarify the stance of the Libra project, stating that Libra it is not planning to be a new currency that will compete with existing currencies, but instead create a “better payment network and system running on top of existing currencies”.
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Cryptocurrency trading remains embryonic

Banks should separate their balance sheet trading activities with cryptocurrencies such as bitcoin and cover them with sufficient equity, said Monday a member of the Executive Board of the European Central Bank.
"Due to the high volatility of virtual currencies, it would seem appropriate to require (banks) that operations with this type of currencies be supported by adequate levels of capital and separate from other trading and investment activities", said Yves Mersch Monday at a conference in Turkey.
The custodian institution of the euro is issuing this warning while some institutions do not hide their intention to offer new services involving bitcoin, giving legitimacy to this cryptocurrency opaque and which divides the financial circles.
Taking the opposite of the big American financial institutions, Goldman Sachs announced in March to engage in the brokerage of financial products related to Bitcoin.
In Switzerland, the giants UBS and Credit Suisse have kept away from virtual currencies, but a smaller player, Vontobel, has issued the first bitcoin structured product, a publicly traded participation certificate (tracker) that allows for the participation of to movements on the virtual currency without having to buy it directly.
A very risky game, while from December to February, "the price of bitcoin rose from nearly $ 20,000 to less than $ 7,000," said Mersch.
Cryptocurrency trading remains embryonic, with 200,000 bitcoin transactions in the world per day, compared with 330 million payments in current currency in the euro zone.
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Unveiling of €100 and €200 banknotes Vidéos SEO Abondance - YouTube IronFX Daily Commentary by Peter Iosif  19/02/2018 - YouTube S&P 500 Futures Opening Range 5.08.2013 - YouTube 오비브레이커

Leave this field empty if you're human: Bitcoin, Blockchain & Cryptocurrency News. Advertisement; BTCm News; Contact us by Carlos Terenzi Jan 1, 2018 Bitcoin News 0 comments 7492 Views . The European Central Bank (ECB) is worried about Bitcoin and its possible negative effect to financial stability. Yves Mersch, member of the executive committee of the ECB, is following the cryptocurrency market cautiously. According to him, it can create a big... Yves Mersch has said bitcoin could pose a threat to economic stability if financial infrastructure institutions get involved with the cryptocurrency. European Central Bank . ECB’s Yves Mersch ... Während Mario Draghi im Hintergrund verweilt, warnte EZB-Direktor Yves Mersch im vergangenen Monat im Zuge des Bitcoin-Börsenganges in einem in dieser Woche veröffentlichten Interview mit Börsen-Zeitung vor den Gefahren des Bitcoins.Zwar sei dessen Handelsvolumen mit einem geschätzten Umsatz von 250 – 350 Milliarden Euro zu gering für konkrete geldpolitische Eingriffe, dennoch handele ... European Central Bank (ECB) executive board member Yves Mersch has said bitcoin poses a threat to economic stability if financial infrastructure institutions get involved with the cryptocurrency. In an interview with a German daily Börsen-Zeitung, Mersch said that bitcoin’s trading volume is currently “comparatively low” and is therefore not an issue for monetary policy at present.

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Unveiling of €100 and €200 banknotes

La Banque centrale européenne s'inquiète une nouvelle fois de la popularité du Bitcoin. Un membre du directoire de la BCE , Yves Mersch, a pressé ce jeudi 30 novembre les banques commerciales ... “Digital transformation of the retail payments ecosystem” Yves Mersch, a member of the ECB’s executive board, was dismissive of these digital tokens but he urged commercial banks to provide ... Edible Planet is a non-profit cooperative that facilitates access to a broader, more diverse selection of fresh fruits, vegetables, berries, herbs and flower... Executive Board member Yves Mersch unveiled the new €100 and €200 banknotes on Monday 17 September. The new banknotes complete the second series of euro banknotes – the Europa series – and ... Informer tous les congolais de la République Démocratique du Congo (RDC) dispersés à travers le monde

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