“Libra threatens EU monetary policy”

Member of the Executive Council of the European Central Bank (ECB) Yves Mersch warned of the threat that Libra poses to monetary policy and consumers in the EU.

In an interview
Reuters on Monday, Mersh said:

“Libra could weaken the ECB’s control over the euro, weaken the transmission mechanism of monetary policy, affecting the liquidity position of eurozone banks, and undermine the international role of the single currency.”

According to Mersch, the centralized nature of Libra stablecoin is also of extreme concern. He emphasized that cryptocurrency will be accountable to asset holders, which raises trust issues and will not be provided by any central bank.

He also said that Libra is being created by the same company, which “has already had to answer to lawmakers in the United States and the European Union in connection with threats to our democracies arising from the processing of personal data by the company on its platform.”

Mersh called on EU regulators to take control of Libra, adding that international cooperation is necessary to counter the perceived risks that a cryptocurrency project can carry. Finally, he urged Europeans not to abandon “the security and reliability of established payment solutions and channels in favor of the attractive but dubious Facebook promises.”

Mersch was the last representative of the ECB to express his doubts about Libra. Earlier, ECB board member Benoit Coeure noted that regulators from various countries need to prepare for the invasion of companies such as Facebook in the financial sector. In addition, at the end of August, the European Antimonopoly Committee began
checking the Libra project.