G7 warns on ‘serious risks’ posed by Libra and other digital coins

Cryptocurrencies such as Facebook’s Libra will need to be tightly regulated or they could destabilise the global economy, according to a working group set up by the G7 group of major western economies and Japan.

The financial innovations risk being used for money-laundering and the financing of terrorism, said a preliminary report from the group led by Benoît Cœuré of the European Central Bank, which was published on Thursday.

“[T]hey give rise to a number of serious risks related to public policy priorities including, in particular, anti-money laundering and countering the financing of terrorism, as well as consumer and data protection, cyber resilience, fair competition and tax compliance,” according to the report.

“They could also pose issues related to monetary policy transmission, financial stability and the smooth functioning of and public trust in the global payment system.”

The US and France are among the governments that have been most vocal in their…