BOE sets guidelines for Facebook’s Libra

  • by Ofeed Team
  • October 9, 2019, 11:1 AM
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The Bank of England has set the rules that digital currencies and especially Facebook' Libra and other new digital payment providers must apply during the upcoming period until they are allowed to open their business in Britain.

The BOE's Financial Policy Committee has published the recommendations, which are due to be implemented in the coming period, with the committee saying in a statement: "The terms of participation in innovations such as the Balance must be adopted before any launch."

They also said, "Libra has the potential to become a systemically important payment system."

These recommendations are to include a requirement for the entire payment chain to demonstrate its financial and operational resilience, and to provide adequate information to regulators monitoring payments.

The Bank of England's FPC said that for the time being, it would apply its principles by applying existing supervisory "instruments", rather than resorting to new rules.

In December, it would see changes in the so-called open funds after a review by the bank and the Financial Conduct Authority, the FPC added.

The Risk Control Authority said it would consider more "potential policy and supervision tools" in the fourth quarter to reduce the stock of old Libor contracts. The sterling Libor is due to be disposed of by the end of 2021.

On the contrary, the European Union (EU) said on Tuesday that it would propose a new law to cover encrypted asset projects such as Libra, saying they pose a threat to the broader financial system.

Meanwhile, Bitcoin is 0.26 percent up at $8,219, according to CoinMarketCap. Ripple and Ethereum were 1.20 percent and 1.01 percent up respectively.

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