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Government Concerns about Libra

U.S. President Donald Trump launched several attacks on Facebook’s new Libra cryptocurrency. He started by censuring cryptocurrencies in general, saying he is not a fan of Bitcoin and other cryptocurrencies that aren’t money and whose value is volatile. Later, however, he followed those tweets with his concerns about Libra in particular.

Claim of little dependability

According to Trump, Libra will have little standing. Trump added that unregulated crypto assets can facilitate illegal behavior like the drug trade and other unlawful activity. The President suggested that if Facebook and other companies want to become banks, then like other banks, they must get a new banking charter and work according to banking regulations.

He did not stop there, and said that the country has only one real currency, which is both reliable and dependable – the U.S. Dollar.

France is also opposed to Facebook’s Libra plans. An official at the French finance ministry said recently that the country would not let any private company start a virtual currency equivalent to a national currency.

According to French officials, a cryptocurrency issued by a company like Facebook, which has a user base of hundreds of millions of people, would come with unacceptable systemic risks. The French statement comes just before the G7 meeting that will probably discuss important agenda items like cyber security and cryptocurrencies.

Facebook insists that Libra will stay legal

A Facebook spokesperson responded that the Libra association would not operate as a bank or interact with consumers, and that the cryptocurrency is only meant to complement the present financial system. Facebook and Libra Association executives added that they expect Libra to be subject to sales tax as well as capital gains taxes.

Further, they revealed that Facebook is talking with money exchanges and local convenience stores to make sure that anti-laundering checks are applied when people cash-in or cash-out the cryptocurrency for traditional currency.