Report: G7 Says ‘Global Stablecoins’ Pose Threat to Financial Stability
Aaron Wood's original article for cointelegraph.com reduced by 43%
The G7 group of nations has reportedly drafted a report which says that "Global stablecoins" pose a threat to the global financial system. According to the BBC on Oct. 13, a draft report from the G7 outlined the various risks associated with digital currencies.
"The G7 believe that no stablecoin project should begin operation until the legal, regulatory and oversight challenges and risks are adequately addressed. Addressing such risks is not necessarily a guarantee of regulatory approval for a stablecoin arrangement." The G7 also states that global stablecoins with the potential to scale rapidly could stifle competition and threaten financial stability if users lose confidence in the coin. The BBC states that, while the report does not single out Facebook's proposed Libra stablecoin project, it could spell further trouble for the already beleaguered proposed payments system.
Global regulators are increasingly leaning on the project, with the Bank of England recently establishing provisions with which it must comply before it can be issued in the United Kingdom. Facebook CEO Mark Zuckerberg will testify before the United States House of Representatives Financial Services Committee about Libra later this month.
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