Japanese Finance Minister Taro Aso on Wednesday urged his G7 counterparts to make a comprehensive assessment of Facebook Inc’s Libra digital currency for any fresh challenges that could be overlooked by existing regulations.
The social media company’s plan to launch a digital coin has met with criticism from regulators, central bankers and governments who say it must respect anti-money-laundering rules and ensure the security of transactions and user data.
Policymakers also fear widespread adoption of the digital currency by Facebook’s 2.38 billion users could upend the financial system.
“Applying existing regulations alone may not be enough. A comprehensive examination is needed to see if Libra poses new challenges that existing rules do not take into account,” Aso told reporters after the first day of a two-day G7 gathering that ends on Thursday.
“On the other hand, authorities need to respond in a timely fashion so they’re not behind the curve.”
Finance leaders of the Group of Seven top economies gathering in Chantilly, north of Paris, agreed on the need to highlight their concern on Libra, though there was no consensus on how to regulate it, said a senior Japanese finance ministry official who was present at the talks.
“Most G7 members saw Libra as posing a serious problem from the perspective of consumer data protection and the impact on monetary policy,” the official told reporters. Such concerns will be reflected in a chair country’s statement to be issued by France after the conclusion of the G7 meeting, he added.
Earlier on Wednesday, U.S. lawmakers bashed Facebook over its planned cryptocurrency, saying the company had not shown it could be trusted to safeguard the world financial system and consumers’ data.
Aso said the G7 finance leaders also reconfirmed an assessment made by the bigger G20 gathering that the global economy remained on track for a recovery, despite strains from the simmering U.S.-China trade tensions.
“There was an agreement (among the G7 members) that the global economy will likely recover through next year,” Aso said.