“Heads I win; tails you lose.” For Finance Watch, this is what the Libra digital money project that Facebook wants to launch in 2020 is all about.
After the warnings from the G7 Finance Ministers last week (see EUROPE 12299/11) and the regulators (see EUROPE 12278/21), Tuesday 23 July was the time to sound the alarm.
“Having already infiltrated our private lives with its social media business model, the tech group is now preparing together with other private companies to take control over another crucial area: money. Libra could destabilise our financial system and concentrate power in unaccountable hands”, said Benoît Lallemand, Secretary General of Finance Watch.
In a document, the organisation details ten reasons why Libra is a “bad idea”. First, it points out that it is not a currency or a cryptocurrency, but a “payment token controlled by a handful of global companies”, which could increase systemic risk in financial markets, exacerbate a global financial crisis and be the subject of intense speculation.
The protection of users' data would of course not be optimal and Libra could facilitate the digital profiling of citizens, it said. The organisation even goes so far as to say that Libra could “threaten our democracies” and become a transit channel for dirty money.
Finance Watch also deconstructs Facebook's argument that Libra would be a revolutionary initiative for financial inclusion, recalling that, to access it, its users would need at least a smartphone and an Internet connection, as well as a certain level of technical expertise.
On Tuesday, Finance Watch and its German partner Finanzwende, launched a citizens' petition calling on the new President of the European Commission, Ursula von der Leyen, as well as the current President of the European Central Bank, Mario Draghi, and Christine Lagarde, who has been appointed to succeed him, to take immediate regulatory action to freeze Facebook's project until it addresses all concerns related to its introduction.
See the document: https://bit.ly/2SxI3tw (Original version in French by Marion Fontana)