The slightly negative attention from institutions towards Facebook’s Libra continues with the German Central Bank’s President Jens Weidmann, saying that they have to slow it down with further regulations. He also notes that banks must improve their payment systems and the E.U. should be more considerate regarding launching e-euro.
Weidmann On Digital Euro
Ever since Facebook announced its plans to create a stablecoin, dubbed Libra, the world has turned its attention towards this sort of digital assets. The European Union was also among the establishments that were rumored to consider launching its own similar product, which at the time was regarded as a direct move against Libra.
The chief of the Bundesbank, Jens Weidmann, is the latest to speak about a potential unifying European digital coin. According to a local report, he thinks that the E.U. should be more considerate and careful before attempting to launch the digital euro. He also reportedly adds that before its creation and release to the mass public, they must define the real purpose of the coin, otherwise risk a negative backlash.
Moreover, Weidmann notes that before turning to a digitalized version of the European currency, banks should make their payment transactions much faster and cheaper. If they manage to succeed at this, it might eliminate the need for digital projects such as Libra.
Weidmann’s Views On Facebook’s Libra
The wave of controversy against Libra doesn’t appear to slow down, even if the company hasn’t released any new information recently. Weidmann also seems quite skeptical as mentioned above, but he continues with his views on the potential project that should be released later this year.
When asked a question if Facebook’s cryptocurrency announcement had a real impact on the financial world, he explains:
“I would be careful with the concept of currency. Facebook is planning a digital form of payment, tied to a basket of multiple currencies such as the euro and the U.S. dollar. This creates an exchange rate risk for the users. We have stable money with the euro that has proven itself of the past decades.”
He continues by adding that such stablecoins could be more needed and successful in countries with weak official currencies, such as some emerging markets.