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Facebook thinks that Switzerland’s data protection commissioner should oversee Libra’s stated commitment not to monetize users’ data in the way that Facebook makes profit from selling personal information to advertisers.
Switzerland is known as being crypto-friendly and a safe haven for a lot of blockchain and crypto companies for a long time now. With over 700 blockchain-related companies having a presence there, the town of 30,000 people has been dubbed “Crypto Valley.” No wonder Facebook decided to open their Libra Association in Geneva. David Marcus recently released a statement announcing that he expects the new coin to be governed by Swiss law:
“Because the (Libra) Association is headquartered in Geneva, it will be supervised by the Swiss Financial Markets Supervisory Authority (FINMA). We have had preliminary discussions with FINMA and expect to engage with them on an appropriate regulatory framework for the Libra Association.”
On his first day of hearing in front of U.S. Congress, there was however a constantly repeated question to which Marcus didn’t have an answer: How could he reconcile the Senate’s desire that all of this crypto stuff should be primarily regulated by the US, when the Libra Association is based in Switzerland and regulated by its authorities?
However, an interesting thing is that right after hearing, a spokesman for the Swiss Federal Data Protection and Information Commissioner (FDPIC), Hugo Wyler, said that Facebook hasn’t reached out. He said:
“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.
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 in the public debate.”
On the other hand, it could be just a matter of time because Swiss Financial Markets Supervisory Authority (FINMA) who would be the main financial regulator of Libra, who confirmed that they were in contact with initiators of the Libra project.
German Bundesbank Comes Out in Favor of Libra
But it isn’t only Switzerland that is keen on Libra. During the G7 meeting, Jens Weidmann, president of Germany’s central bank, the Deutsche Bundesbank, has come out in favor of Facebook’s cryptocurrency saying that there’s no reason to be alarmed but there’s a reason to be vigilant. He also added he can not understand the skepticism of his counterpart against digital currencies like Libra. He said:
“If they deliver what they promise, they can be attractive to consumers.”
Nevertheless, let’s remind you that recently, G7 finance ministers issued a warning that digital currencies such as Libra pose risks for the world’s financial system if they are not regulated tightly. During a news conference on July 18, French finance minister Bruno Le Maire reportedly said that G7 “cannot accept private companies issuing their own currencies without democratic control.”