Facebook ‘s controversial ‘ cryptocurrency ‘ Libra is facing yet more scrutiny after the governor of Japan’s central bank called for international cooperation to regulate it.
According to Reuters , Haruhiko Kuroda, the Bank of Japan ‘s governor, told business leaders in Osaka that a joint, international effort was crucial.
“If Libra is introduced, it could have a huge impact on society ,” Kuroda said, noting that policymakers must enforce the highest level of regulation possible.
It comes after several other governments called for similar efforts in the aftermath of Facebook‘s announcement.
Just a couple of weeks ago, France‘s Finance Minister Bruno Le Maire said the European Union needed to establish a common set of cryptocurrency rules to counteract risks posed by Libra.
Prior to that, India also expressed concerns about the digital currency – due to launch in 2020 .
Japan’s race to get regulation right
When it comes to Japan, it’s not surprising that the country wants to take such a harsh stance against Libra.
Japan was home to notorious cryptocurrency exchange Mt. Gox , which collapsed in February 2014 , at the time taking with it more than $450 million of customers ‘ Bitcoins .
Mt. Gox ‘s collapse sent the cryptocurrency world into turmoil and Japan , like many of its counterparts, has been trying to figure out a way to regulate the industry ever since.
Just last month, our robot colleague Satoshi Nakaboto – who by the way reports on Bitcoin every day – wrote about how Japan’s central bank was in love with the cryptocurrency and blockchain technology.
It’s worth noting, however, that the Asian nation put in place stricter rules for cryptocurrency margin trading earlier this year. The new rules, which have been devised to protect investors against possible cams, are set to come into effect in April 2020.
Despite granting the industry self-regulatory status in October 2018, the Japanese Financial Services Agency ( FSA ) announced in November that it was devising a regulatory framework for cryptocurrency wallet services.
For years, governments and regulators have tried to exert their authority in hope of regulating the cryptocurrency industry, but it seems Libra may prove to be the catalyst they need to do just that. Or not.
Come say hi to the Hard Fork team at our blockchain event . On October 15-17 in Amsterdam, hear from top experts as they discuss the industry’s future.
China wants to destroy ‘wasteful’ Bitcoin mining
China, one of the world’s most prominent blockchain and cryptocurrency forces, wants to put an end to “wasteful” Bitcoin mining.
The National Development and Reform Commission (NDRC) has added cryptocurrency mining to its latest list of industries it wants to restrict, or eliminate, Reuters reports .
The list outlines activities the NDRC believes should be phased out as they lead to legal complications, pose safety risks, or wastefully pollute the environment.
Bitcoin has often been criticized for its high energy use , it was previously reported that the mining network uses more electricity than 20 countries in Europe. That said, Bitcoin mining is actually driving green-energy innovation . While cryptocurrency mining might require large amounts of electricity, Bitcoiners often argue it’s not necessarily wasteful or polluting.
No deadline has been set for when these industries should adhere to the directive. Activities should be phased out immediately, according to the document.
The public have been given until May 7 to comment on the draft directive.
China has had a tumultuous past when it comes to cryptocurrency and blockchain.
Despite banning initial coin offerings (ICO) and security token offerings (STO), it has remained open to blockchain. The Asian country is expected to become a global super power in the technology by 2023, and currently has the most blockchain patents in the world.
Last week, Chinese regulators published a list of the first 197 officially regulated blockchain companies. It included the likes of Alibaba, Tencent, and Baidu.
Today’s news only further demonstrates China‘s continued “ blockchain, not Bitcoin ” stance.
Did you know? Hard Fork has its own stage at TNW2019 , our tech conference in Amsterdam. Check it out .
Facebook, stop trying to make Libra happen
Just when we thought Facebook’s Libra couldn’t be subject to any more scrutiny, it turns out that data protection bosses from all over the world have banded together to share concerns about the ‘cryptocurrency’s’ potential privacy risks.
Data officers from the UK , European Union , US , Canada , Burkina Faso, and Australia issued a joint statement on Monday, noting that “while Facebook and Calibra have made broad public statements about privacy , they have failed to specifically address the information handling practices that will be in place to secure and protect personal information .”
“The involvement of Facebook Inc. as a founding member of the Libra Association has the potential to drive rapid uptake by consumers around the globe , including in countries which may not yet have data protection laws in place. Once the Libra Network goes live, it may instantly become the custodian of millions of people ’ s personal information ,” the statement adds.
With this in mind , and with Facebook planning to release Libra as early as 2020 (even though some policy experts deem this unlikely ), the data chiefs set out a series of questions that they’re hoping Facebook will respond to, including further probing about the tech giant’s handling of individual consumer data and how this would be shared among network participants.
Facebook’s regulatory woes
It goes without saying that Facebook ‘s plans to launch a global ‘ cryptocurrency ‘ haven’t gone down well with regulators and governments across the globe .
In June, Libra received an early jolt in India , where the social networking platform boasts more than 300 million users – a number that’s expected to rise over the coming years.
Over in the UK , where Facebook was questioned by MPs following its highly publicized Cambridge Analytica data scandal, Libra has also ruffled feathers among politicians amid concerns that its entry into the world of finance would inevitably grant the company too much power .
France also announced it was putting together a Group of Seven Nations ( G7 ) task force to explore how central banks can make sure cryptocurrencies adhere to money-laundering and consumer protection rules.
The tech giant is also seemingly battling consumer apathy. A recent poll by CivicScience, which looked into general interest and public concerns surrounding Libra following the announcement of its launch, found that only five percent of 1,799 US adults surveyed expressed any level of interest in the proposed ‘ cryptocurrency .’
Facebook has also been forced to take action against scammers , who are taking advantage of the Big F’s entry into the digital currency space , and ironically peddling fake coins on its own platform.
Unsurprisingly, Facebook is facing greater scrutiny than ever before. We already know the network can’t quite be trusted with our data , but it remains to be seen how, or if, the company will collaborate with authorities to ensure Libra is successful and compliant.