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Facebook’s crypto could become a regulated security. CNBC reports that a new US bill is backed by a bipartisan group who weren’t impressed with Zuck’s testimony at a recent House Financial Services hearing.

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  • This bill butchers the definition of a security... The Libra Investment Token (owned by network moderators) should probably be regarded as a security since there's an expectation of return on capital. However, Libra tokens (used by customers) probably *shouldn't* be treated as securities. The smallest

    This bill butchers the definition of a security... The Libra Investment Token (owned by network moderators) should probably be regarded as a security since there's an expectation of return on capital. However, Libra tokens (used by customers) probably *shouldn't* be treated as securities. The smallest fluctuation in price would trigger short-term capital gains tax, and that would make it extremely undesirable.

    Libra is more like a private currency—and this bill puts the cart ahead of the horse. Until Facebook and the Libra Association offer clarity, legislators are wasting their time trying to regulate a moving target. Let's find out how much a Libra is worth and then let's proceed.

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  • By allowing Facebook to act like a bank it has to be regulated like a bank. Libra if it is allowed to exist would replace real currency traceable through the banking system with what would become untraceable anonymous transfers. Sort of a virtual version of BCCI.

    The second problem will be security

    By allowing Facebook to act like a bank it has to be regulated like a bank. Libra if it is allowed to exist would replace real currency traceable through the banking system with what would become untraceable anonymous transfers. Sort of a virtual version of BCCI.

    The second problem will be security of the collateral accounts across multiple jurisdictions and the impact on the Forex market. Will the regulatory agencies require the same level of capital adequacy and controls on market risk as per the BIS?

    To classify Libra as a security to provide regulatory cover doesn't go far enough.