World leaders and governments have been at their wits’ end recently, with many of them still uncertain about how to properly tackle the prospect of Facebook and its cryptocurrency. Ireland’s Finance Minister Michael D’Arcy is the latest to give his insight on Libra, blockchain and their effect on Ireland’s finance strategy, speaking about them during an interview at Sibos 2019.
During the interview, D’Arcy conceded that Libra and stablecoins are a challenge, adding that while some governments and departments of Finance are opposed to it, Ireland is only being cautious. He said,
“We are cautious. And my role as minister has me looking at this in substantial detail. I am cautious in relation to stablecoins and in relation to Libra. My senior minister is very cautious. The Central Bank of Ireland regulator is cautious. So we’re somewhere between cautious and very cautious.”
According to the minister, the benefits stablecoins can have internationally are well-understood and accepted. However, the challenges they could pose to governmental and monetary policies cannot be overlooked, D’Arcy said.
“Regulation tends to catch up only when it has to. Libra hasn’t been launched so from the regulation side, it hasn’t caught up, and we don’t want regulation to catch up too late. The benefit of Libra that I see is that conversations are being held. So rather than trying to play catch up, I think regulation will get ahead of it. I see the benefit that could happen for consumers, which is why I’m cautious while others are very cautious.”
With regards to financial strategy, Ireland see blockchain as a huge player in innovation and technology. He also spoke about plans to establish an innovation district, as well as the creation of a fintech foresight group. D’Arcy also stated that there is no systemic risk to Ireland because their regulator is an agent of the European Central Bank, which means all decisions will be made in agreement with European partners. When asked about how Libra is a threat to Irish consumers and businesses, he said,
“Libra is untested. The theory of Libra is fine and it looks to work well, but in practice we have yet to see how it will operate. There will be challenges, perhaps unforeseen challenges that we aren’t prepared for just yet. Regulation needs to catch up. You don’t get to put the technological genie back into the technological genie bottle. The technology is there, it’s how we apply it and attach regulation to it to make it a positive rather than a negative.”
According to D’Arcy, Ireland’s main goal is to make sure they advance up the value chain.