Facebook Seeking FINMA’s Payment System License to Regulate Libra

In an attempt to regulate the upcoming digital currency, the Libra Association is planning to receive a payment system license from the Swiss Financial Market Supervisory Authority (FINMA), Reuters reported on Wednesday.

The prospect of the company to gain the license from the Swiss financial market regulator was revealed by the association and its 27 partners in an official statement.

“Switzerland offers a pathway for responsible financial services innovation harmonized with global financial norms and strong oversight,” the Libra Association stated.

The body behind Libra has already initiated talks with the Swiss financial watchdog and is looking into ways to receive the payment system license.

“We are engaging in constructive dialogue with FINMA and are encouraged to see a feasible pathway for an open-source Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned). In this sense, blockchain is immune to the manipulation of data, making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamp Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned). In this sense, blockchain is immune to the manipulation of data, making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamp Read this Term network to become a regulated, low-friction, high-security payment system,” it added.

Facing resistance from global regulators

Though Swiss regulators are lenient towards Facebook’s ambition to launch Libra, other regulators and lawmakers from major countries are hostile towards the social media company’s approach in the Payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term industry.

In two separate hearings in front of US lawmakers in July, David Marcus, head of Facebook’s Libra, failed to clarify many crucial design-related questions about the proposed digital currency.

A US treasury official recently said that Libra must comply with the highest regulatory standards to prevent any possibility of money laundering and terror financing.

Responding to the concerns of a US senator, Facebook recently revealed that it is planning to tie its cryptocurrency to major fiats including the US dollars, euro, yen, British pound, and the Singapore dollar. However, it clarified that the Libra Association, not Facebook, would be responsible for deciding the operational criteria of Libra.

On a side note, FINMA last month issued a banking license to two crypto companies - SEBA Crypto AG and Sygnum AG - operating in the country, making them the first such companies to gain the license.