Germany Takes a Stand Against Private Currencies
In a bold move, Germany’s government has approved a blockchain strategy aimed at curbing the threat of stablecoins acting as alternative currencies. This decision, made by Chancellor Angela Merkel’s cabinet, reflects a protective stance on state sovereignty in the face of looming digital currencies, notably the Libra cryptocurrency from social media giant Facebook.
A Cautious Approach to Digital Currency
Finance Minister Olaf Scholz articulated the delicate balance the government seeks to strike. “We must protect consumers and state sovereignty. Currency issuance should not be left to private companies,” he emphasized. While the government is keen to boost Germany’s status as a technological hub and spur blockchain innovation, there’s a palpable caution surrounding the potential risks involved with private currency issuance.
Fostering International Alliances
As part of this strategy, Germany plans to collaborate closely with European and international partners. The aim is to ensure that digital stablecoins do not escape the regulatory net and evolve into recognized alternative currencies.
Exploring Central Bank Digital Currencies
Alongside this strategy, there’s a push to boost dialogue with the Bundesbank. The focus will be on evaluating the benefits and hazards associated with the potential introduction of digital central bank money. Could this be the next big step for Germany? Time will tell, but the excitement brewing in the financial sector is palpable.
Legislation on the Horizon
In an effort to harness blockchain technologies, the German government plans to introduce new legislation in 2019, focusing on the advent of blockchain-based electronic bonds. This could pave the way for innovative financial solutions while ensuring that the state maintains oversight over currency-like assets.
An Anti-Libra Coalition?
Germany hasn’t gone solo in its stance against Libra. Reports suggest a synchronized effort with France to combat this perceived threat. French Finance Minister Bruno Le Maire has underscored the need for Europe to develop its own public digital currency that can stand against Libra. After all, two heads are better than one, especially when it comes to maintaining a robust economic framework.
In the Words of Bafin
Felix Hufeld, president of Germany’s financial watchdog Bafin, recently echoed concerns about Libra. He stated, “We have asked questions, we have received responses, but the clarity remains wanting.” As discussions with Libra’s developers continue, it’s clear that the trepidation surrounding these stablecoins is both serious and justified.
