Facebook’s Libra cryptocurrency project is seeking a Swiss payment system licence, financial watchdog FINMA said on September 11, noting the breadth of the planned services would require broad oversight.
The world’s largest social media network announced plans in June to launch a cryptocurrency as it seeks to expand beyond social networking and move into e-commerce and global payments, though the plans have drawn intense scrutiny from global financial officials.
“Due to the issuance of Libra payment tokens, the services planned by the Libra project would clearly go beyond those of a pure payment system, FINMA said, noting this mean it would be subject to such additional requirements.
These would extend to capital allocation for credit, market and operational risks, risk concentration and liquidity, and the management of the Libra reserve, it said.
“We are engaging in constructive dialogue with FINMA and we see a feasible pathway for an open-source blockchain network to become a regulated, low-friction, high-security payment system,” the Geneva-based Libra Association said.
FINMA said that oversight of the range of services provided by Libra would follow the maxim “same risks, same rules.”
“The highest international anti-money laundering standards would need to be ensured throughout the entire ecosystem of the project,” it said.