Switzerland’s money watchdog says it’s ready to cooperate and oversee how the Libra Association regulates Facebook’s upcoming cryptocurrency.
In an interview with Neue Zürcher Zeitung (NZZ), FINMA director Mark Branson said it would be unreal to imagine a project of Libra’s scope regulated by just one country
Libra And The Swiss Regulatory Framework — It’s A Match
Branson argued that Switzerland’s intention to become a distinctive financial center would essentially entail reputational risks and therefore draw international attention:
“Shy of these risks, you have less attention, but may end up in insignificance,” he stated.
Nowadays, Switzerland counts on a solid regulatory and supervisory framework that enables it to work alongside top legacy financial players, including ambitious projects like Libra Coin.
According to Branson, FINMA is fully aware of the challenges that a project of Libra’s caliber implies for regulators: “It was crystal clear from the start that this project could have huge dimensions and implications,” he said.
In his opinion, the supervision of the Libra Association can’t fall entirely on the hands of a single regulatory authority, just like it happens with major banking institutions like UBS or Credit Suisse. International coordination and consultation will certainly be required to supervise Libra.
Furthermore, Branson highlighted that FINMA’s approach to regulation is based on both strong principles and technology neutrality, making it a perfect fit for the Libra Association:
“Switzerland […] does not regulate all forms of institutions and products down to the last detail […] We have just published a guide on how to classify stablecoins under Swiss law. And we show: it does not need new laws. The risks are well known, for example regarding money laundering, customer protection, system stability. There are already regulations for all of these.”
Libra Isn’t Shopping For A Soft Regulatory Agency
Branson also took a moment to explain that Facebook’s choice to establish the Libra Association in Switzerland wasn’t about shopping for the softest jurisdiction.
“Such a ‘beauty contest’ did not exist. Our first contact with the initiators took place after the decision for Switzerland had already been made and communicated. That’s positive. The ‘jurisdiction shopping’ you alluded to would be very sensitive. It would put pressure to get as loose as possible standards.”
As Crypterium reported yesterday, Facebook has requested a comprehensive assessment from FINMA as it gets ready to acquire a Swiss payment license.