On 18 June 2019, Facebook announced the creation of a new cryptocurrency, Libra, managed by a Geneva-based association, the Libra Association. Its members include major multinationals and non-governmental organisations. One of the association's central missions is to facilitate financial inclusion around the world. More generally, a project of this kind could accelerate cross-border payment traffic and reduce the costs involved.
Libra is based on blockchain technology and is one of the cryptocurrencies described as "stable coins": it is designed to limit its volatility as it is linked to a basket of currencies.
With regard to the Swiss authorities, they are following developments very closely. They are in close contact with the project initiators and are working in a coordinated manner both nationally and internationally. Representatives of the State Secretariat for International Finance (SIF) and other Swiss authorities met with a US parliamentary delegation on 23 August 2019 in Bern to discuss, among other things, the Libra project. On 10 September 2019, SIF also received US Under Secretary of the Treasury Sigal Mandelker. The talks focussed on the fight against money laundering and the financing of terrorism as well as on cryptocurrencies in general.
In Switzerland, a project such as Libra can only be implemented with the authorisation of the Swiss Financial Market Supervisory Authority (FINMA). On 11 September 2019, FINMA announced that the project, as currently planned, would be considered as a payment system and would require a corresponding authorisation. Such a system would automatically be subject to the Anti-Money Laundering Act. This would ensure that the highest international standards in the fight against money laundering are met.
With regard to Libra, SIF has adopted the following position:
- The choice of Geneva for the organisation's headquarters is a positive sign for Switzerland as an open and innovative economic and financial centre.
- Such innovative projects involve opportunities and risks that need to be proactively addressed.
- The Federal Council attaches great importance to the fight against money laundering and other crimes. Switzerland's anti-money laundering and anti-terrorist financing system is technology-neutral and applies to virtual assets.
- Given the global scope of the Libra project, coordination at the international level is essential. The Swiss authorities are seeking dialogue with foreign authorities and actively participating in the analysis of "stable coins" by relevant bodies, such as the Financial Stability Board.