Facebook Libra rejected by France as “dangerous” – Naked Security


Facebook’s original motto: “Move fast and break things.”

France’s finance minister Bruno Le Maire: Non merci, not our global economy, you don’t.

Last week, on Thursday, 13 September, Le Maire said in a speech at the OECD Global Blockchain Policy Forum 2019 – a digital currency conference – that he sees Facebook’s forthcoming Libra cryptocurrency as a “danger to consumers”, a “systemic risk” and a threat to France itself:

Our monetary sovereignty is at stake.

The existential threat seen by France and other governments: that Facebook’s more than 2 billion users, investors, consumers, and the broader global economy could become entangled with a risky currency that sets them up for having to bail them out. Governments, including France last week and the US, the EU and the UK earlier in the month, have said that they might have no choice but to bail out Facebook if Libra goes off the rails, since it would be too big to fail.

Facebook’s 29-page white paper says that the cryptocurrency, created by the Switzerland-based Libra Association, will run on an open source blockchain software developed by Facebook. Financial institutions including Mastercard, Paypal, and Visa will support it and doubtless profit from the venture, although Facebook is taking a leadership role for now.

Le Maire said that besides the risk of countries having to bail out the currency if it goes under, other risks include harder-to-track money laundering and terrorism financing. He urged Facebook to look at creating a separate “public digital currency” instead. What he told conference attendees:

I want to be very clear. In these conditions we cannot authorize Libra’s development on European soil.

As far as Facebook’s Libra plans go, that’s not good. Le Maire’s statement came just a month after data protection officials from the US, EU and UK issued a joint statement outlining their concerns about Libra. From that statement:

While Facebook and [its Libra-focused subsidiary] Calibra have made broad public statements about privacy, they have failed to specifically address the information handling practices that will be in place to secure and protect personal information.