Saudi Arabian Monetary Authority (SAMA) and the UAE are working indoor to finally bring their jointly designed cryptocurrency to the world, Today’s Gazette has learnt.
The two allies say it is finalizing the pilot operations of the digital currency Aber designed for cross-border remittance, which they both unveiled early this year.
A report by Al-Eqtisadiah quoted SAMA’s Deputy Governor for Banking Operations, Hisham Al-Hogail, on the finalization of the pilot operations, which will possibly be centered on the technical aspects.
However, the economic and legal operations are to be looked into during the latter period.
According to Al-Hogail, SAMA is working on expanding the digital currency to other countries to facilitate the transnational remittance. The Deputy Governor did not state the countries it intends extending to in the nearest future.
The two countries’ central banks are making use of Blockchain and Distributed Legders technologies to achieve a proof-of-concept digital currencies for low fees cross-border remittance.
In January when Saudi and UAE launched a trial version of their digital currency dubbed Aber, it used the test version to confirm how cheap the cross-border remittance could be with the cryptocurrency. At that time, the two countries limited the test version to few banks.
As the two countries prepare to launch their jointly managed digital currency, Saudi’s Finance Ministry had recently warned citizens of Saudi to be careful while trading using cryptocurrency within the country.
The ministry importantly warned against imposters using the image of the country to promote fraudulent cryptocurrency assets to unsuspecting citizens, saying it has no relationship with them.
The ministry mentioned CryptoRiyal and SmartRiyal to be properties of a Singapore-based firm.
The crypto firm was alleged of claiming to be using proceeds from the digital currency to finance Saudi’s smart city NEOM, a new tourism project by the country.
Save for Aber, which the country is involved in, Saudi does not have any relationship with any cryptocurrency firm as at now.
Do not forget that Saudi banks makes use of RippleNet, however, the country is not using XRP for cross-border remittance as far as we know.
Facebook to Face Global Regulators about its Libra Cryptocurrency Project
According to recent news, Global regulators will interrogate Facebook shortly regarding its Libra cryptocurrency, even though the EU governments expressed concerns that the digital currency poses a danger to financial stability. As per the Financial Times, Facebook needs to face 26 national banks, inclusive of the US Federal Reserve and the Bank of England, will meet with delegates of Libra in Basel shortly, the FT stated, referring to authorities.
Moreover, Facebook has pitched Libra as an approach to democratize money, providing banking for first-timers, and making a format that is independent of any one nation. However, it is the last part that has worried the authorities. Facebook opined that it invites open exchange with controllers. In a recent discussion, Libra told Financial Times –
“In the nearly three months since the intent to launch the Libra network was announced, we have prioritized engagement with regulators and policymakers around the world, we welcome this engagement and have deliberately designed a long launch runway to have these conversations, educate stakeholders and incorporate their feedback in our design.”
Besides, the meeting will reportedly happen among Libra and the Committee on Payments and the Bank of International Settlement’s forum, Market Infrastructure. Facebook authorities will be questioned about the design and scope of the cryptocurrency, and a report will be filed for G7 finance minister in October.
Regardless, Libra‘s founders have additionally been asked to respond critical questions regarding the currency, Financial Times said. Further, Nations inclusive of France and Germany have publicly condemned the social media giant’s Libra venture, saying it presented dangers to EU states Sovereignty.
The Libra Association, an alliance of 28 members set up together by Facebook to help the cryptocurrency to realization, includes Uber, Visa, Mastercard, Spotify, and the subsidiary Calibra, among few. Moreover, the members all made a non-restricting guarantee to invest at a minimum of 10 million dollars.
The forthcoming meeting came later when French Finance Minister Bruno Le Maire cautioned that France would not approve the development of cryptocurrency Libra on European soil. He opined that the digital currency poses a risk to the fiscal power of governments and causes issues on illegal tax avoidance, terrorism financing, and market strength. Further, He additionally voiced concerns that Libra can help individuals to abandon national currencies during an emergency, even more complicating the efforts of the government to deal with the economy.
Nevertheless, the governments have voiced strong concerns over Libra and other digital currencies that are seen fit for destabilizing the financial system and lessen the power of governments and central banks. Even though it faces issues, the head of the Libra Association stated that Libra cryptocurrency would be released at the end of 2020.
Facebook’s David Marcus Responds to Critics Over Libra ‘Threat’
The head of Facebook’s Calibra – the entity created by Facebook to provide financial services including a digital wallet for the planned Libra cryptocurrency – has spoken out in response to claims from authorities that the project poses a threat to nations’ “monetary sovereignty.”
In a Twitter thread on Monday, David Marcus, who co-created Libra, said he wanted to “debunk” that notion – one most notably promoted by France’s Economy and Finance Minister, Bruno Le Maire.
Le Maire said last Thursday that, with Libra, “The monetary sovereignty of states is under states is under threat,” and further threatened to block the project’s development in the EU.
Marcus said that Libra will be “backed 1:1 by a basket of strong currencies. This means that for any unit of Libra to exist, there must be the equivalent value in its reserve.” As such, Libra will not be creating new money. That function will “strictly remain the province of sovereign nations,” he said.
The Calibra chief further clarified that Libra is being built to be a “better” payment network utilizing national currencies, and “delivering meaningful value to consumers all around the world.”
Marcus welcomed the attention from regulators, however, saying:
“We believe strong regulatory oversight preventing the Libra Association from deviating from its full 1:1 backing commitment is desirable.“
His comments come as a group of 26 central banks – including the European Central Bank, the U.S. Federal Reserve and the Bank of England – meets in Switzerland to grill the Libra Association over the scope and design of the project.
In the thread, Marcus also pledged to continue working with “central banks, regulators, and lawmakers to ensure we address their concerns through Libra’s design and operations.”
OKEX Korea Drops 5 Privacy Coins Citing FATF Rules
Regulatory pressure on cryptocurrency exchanges to stop providing users with access to so-called privacy coins is growing.
The South Korean arm of the Malta-based OKEX exchange announced early on Monday that it is to delist five cryptocurrencies that provide extra privacy features for users. From Oct. 10, the exchange will no longer support trading in Monero (XMR), dash, zcash (ZEC), horizen (ZEN) and super bitcoin (SBTC).
In its notice, OKEX Korea said it will delist cryptocurrencies that “violate laws or regulations [and] policies of government agencies and major agencies.”
Specifically, in this case, it cited the “travel rule” recommendation to national regulators from the Financial Action Task Force (FATF) as the reason for pulling the five coins.
The exchange said that as per FATF’s rule, “it is recommended that exchanges be able to collect relevant information such as the name and address of the sender and recipient of the virtual asset.”
As such, it had decided to delist the cryptocurrencies that did not allow that data to be obtained.
The U.K. arm of Coinbase also dropped support for zcash in August, likely due to the need to identify users when required by authorities.
This summer, FATF finalized its recommendations to its 37 member nations, including a controversial requirement that “virtual asset service providers” (VASPs), including cryptocurrency exchanges, pass information about their customers to one another when transferring funds between firms.
The so-called travel rule has been a requirement for international banks when sending each other money on customers’ behalf for some time, but has been described as onerous for blockchain firms and harmful to user privacy.
The global anti-money laundering body gave members 12 months to implement the new recommendations that, while not mandatory, could see nations not complying put on a finance blacklist.
Since June, compliance solutions providers in the crypto space have been moving to launch systems aimed to help exchanges pass each other the required data.
OKEX Korea said that customers have until Dec. 10 to withdraw any of the five delisted coins from the platform.