The Reserve Bank of Australia (RBA) says its ready to do all it can to regulate Libra and any other new “payment technologies” that make their way through the country’s borders.
A Test Version of Libra Is Made Available
Australia has been particularly hard towards Libra in the past, citing trust issues and even hinting that the platform was going to face hardcore scrutiny due to a largely unwelcoming attitude. This latest statement suggests that Australia may be giving into the idea that Libra – and systems like it – are part of a digitally enhanced future, and that there may not be a way around it.
Tony Richards of the Select Committee on Financial Technology and Regulatory Technology explained in an interview that the nation had received an “early” version of Libra so regulators could potentially test it out before it becomes mainstream and widely available to the public. He stated:
We’re getting a test of this currently with the proposal via Facebook for its new Libra coin, but that’s a problem I think we can solve. The international community of regulatory and central banks are talking to each other as to how we would regulate Libra if – and when – it’s launched. Certainly, the rapid pace of innovation is creating challenges for us, but for the most part we can deal with those, but we must keep up with technology, so we understand the technology that’s going behind these business models.
Libra has been very controversial since it was first announced in June of last year. It’s parent company, Facebook, had been embroiled in scandal for several years, and many scoffed at the idea that such an enterprise would potentially have access to users’ financial data and other private information.
U.S. regulators probably scoffed the loudest, with both Mark Zuckerberg – the CEO of Facebook – and David Marcus – the man in charge of Libra and Facebook’s blockchain division – eventually being subjected to Senate hearings from lawmakers wanting to get a clear idea as to what Libra would (and could) do to keep people safe.
However, statesmen in European countries – such as France and Germany – took a different stance, saying that they would not allow applications like Libra to permeate their financial ranks.
People May Not Want It in the End
The Reserve Bank recently unveiled in a statement that it’s not certain Libra is going to be widely used or appreciated in Australia, explaining:
Australia is already well served by a range of low-cost and efficient real-time payment methods such as the NPP that utilize funds held in accounts at prudently supervised financial institutions. Moreover, while Australians may not have been well served by banks providing cross-border payment services in the past, a number of new non-bank digital players have entered the market in recent years offering significantly cheaper and faster money transfer services.