A new bill presented by a bipartisan group of US lawmakers could define Facebook’s Libra coin as a kind of “security.” It is a move that would invite further scrutiny of the developing cryptocurrency.
22 November, 2019, AtoZMarkets – It is known as the Managed Stablecoins are the Securities Act of 2019. So, the bill would mean that Libra is subject to the structures of US securities law. And it enforced by the Securities and Exchange Commission (SEC), according to CNBC.
New Bill for Facebook’s Libra Coin
To do this, Facebook should register the Libra with the SEC as a security and apply for a license to operate. That will go directly at the discretion of the regulator.
Reps. Sylvia Garcia, D-Tex. And Lance Gooden, R-Tex proposed the bill. It follows the recent appearance of Facebook CEO Mark Zuckerberg before the House Financial Services Committee on “An Examination of Facebook. That impact on Financial Services and Housing Sectors.”
According to the press, Zuckerberg’s testimony disappointed the legislators. Libra and other stablecoins is “securities under existing laws.” However, Garcia said that the bill would give regulatory certainty to the sector. Clarifying the regulatory structure of these digital assets protects consumers and ensures proper government oversight in the future.
The bill is to clarify in terms of regulation
Mr. Gooden said that digital assets could also be securities under the current law. He argues that the bill would clarify the position with certainty in terms of regulation: “In so-called” managed stablecoins. “We have trusted brands that sell digital assets to consumers as safe and stable. And everyday investors need to know they can trust issuers who hold their financial assets.” That would give them the security they deserve by applying the laws. That should use to regulate financial securities to this new breed of digital currencies. ” Facebook and Libra have so far refused to comment on the bill.
This bill is just the latest legal hurdle that Libra faces in the United States. And the project faces early resistance from regulators and central banks around the world. Because of an international deployment in 2020, Facebook must convince regulators and legislators around the world. And it should meet the expectations of the various jurisdictions in terms of compliance.
Meanwhile, Libra supporters also deny that stablecoin is a security. Calibra, head of Facebook’s cryptographic wallet service, said he did not consider Libra as an exchange-traded fund or a security. However, it could be treated as a commodity. He said it in a hearing the House Financial Services Committee in July 2019.
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