https://www.cnbc.com/2019/11/21/new-bill-would-make-facebooks-cryptocurrency-a-security-under-the-law.htmlA new bill called the Managed Stablecoins are Securities Act of 2019 would make Facebooks libra cryptocurrency a security under the law.
A bipartisan team of representatives introduced the bill on Thursday, which could bring greater regulation to Facebooks libra if passed.
The legislation follows Facebook CEO Mark Zuckerbergs October hearing in front of the House Financial Services committee. One of the representatives introducing the bill said she was disappointed with his answers during the testimony.
Two members of the House Financial Services Committee, Reps. Sylvia Garcia, D-Tex., and Lance Gooden, R-Tex., proposed the Managed Stablecoins are Securities Act of 2019 on the day of a committee hearing on the role of big data in financial services. Garcia explicitly called out libra in a statement announcing the bill, saying that it and other managed stablecoins are clearly securities under existing law.
Once it is a security it is subject to all the regulations that govern securities.
Most importantly, it would be regulated by American authorities (not Swiss as Facebook wanted) if any American used Libra.
If that bill successfully becomes a law, I think it would most likely discourage the Libra Association from continuing the Libra project for fear of any possible issue or issues that may arise with regards to Libra's compliance on securities laws, which effectively puts the project in jeopardy since securities are tightly regulated which in effect could affect Libra operations in one way or the other.
I think its a brilliant move by the U.S. Government in an effort to try to have a certain control over the Libra project where the U.S. Government had doubts and fears on what could be perceived as a threat to its economic stability.