Swiss Regulators Provide An Indicative Classification Of Facebook’s Libra Project
Libra Association recently submitted the request to FINMA asking to clarify the regulatory status of the Libra Association and Facebook’s cryptocurrency Libra Coin.
FINMA today confirmed the receipt of an inquiry from the Libra association and in a press release has provided their indicative classification for the project.
FINMA says that Libra project may fall under “Financial market infrastructure regulation” and would require a payment system licence.
The report adds, “the services planned by the Libra project would clearly go beyond the requirements of a pure payment system and therefore be subject to additional requirements”.
These additional requirements would relate in particular to-
- Capital allocation (for credit, market, and operational risks),
- Risk concentration and
- Liquidity as well as the management of the Libra reserve.
Additionally, the report clarifies that under Swiss supervisory law, the proposed Libra payment system is automatically subject to the Anti-Money Laundering Act. Therefore, the project needs to ensure that the entire ecosystem meets the highest international anti-money laundering standards.
