The Group of Seven nations, G7, in a draft report, has stated that no stablecoin project, including Facebook’s Libra, can march ahead in developments until it is proven safe and secure.
As reported by the BBC, the group declared, “The G7 believe that no stablecoin project should begin operation until the legal, regulatory and oversight challenges and risks are adequately addressed.” It also added that addressing the risks is not always a guarantee of regulatory approval.
The G7 established a taskforce on stablecoin projects as soon as facebook announced Libra in June. The draft report will be presented to finance ministers at the International Monetary Fund annual meeting scheduled to take place this week. The document further mentions that global stablecoins with the potential of being adopted rapidly impose notable regulatory challenges.
Libra continues to stay in a strict zone of regulations. Moreover, the project is seemingly losing support, followed by the regulations arising in the field of protection and confidence of users.
Besides G7, the Financial Stability Board (FSB), which partners with the G20, has also aligned the same aspects of concern, stating that stablecoin projects host challenges to financial stability, investor protection, data privacy, and more. Randal Quarles, chairman of the FSB, in a letter to G20 finance ministers, asserted that these challenges “should be assessed and addressed as a matter of priority.”