19 June 2019

Virtual but by no means sovereign currency

France is keeping a close watch on the development of new virtual currencies, in particular the version that Facebook has just announced.

Facebook has just officially announced the upcoming launch of a cryptocurrency, set for mid-2020. It will enable users to transfer money with Facebook Messenger and WhatsApp, and make purchases on various platforms.

These types of currencies, like the one developed by Facebook in collaboration with a consortium of companies, may be used as transaction instruments and provide consumers with new services. However, under no circumstances can or should such transaction instruments be sovereign currency.

States' sovereignty is a matter for the States themselves and cannot be put into the hands of private companies, which answer to private interests.

Furthermore, we need to be vigilant as to the uses to which such new currencies are put and ensure that they do not enable circumvention of the rules on consumer protection or on eliminating illicit financing. The State's role is to protect consumers and personal data.

This being so, Bruno Le Maire has requested reports from the G7 Central Banks and international institutions by this autumn, specifying the rules to implement in order to ensure that this transaction instrument poses no risk of illicit funding or to consumers.

Finally, its new transaction instrument will enable Facebook to collect millions more pieces of personal data. We need to continue to take action to regulate the digital giants and make sure that they do not become monopolies, with the tax on digital services in France, and internationally once agreement has been reached at OECD level.

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