FILE PHOTO: a Small toy figures in the painting are to be seen in the representations of the virtual currency in the front end of the Scale, the logo in this illustration picture the 21 of June, 2019 at the latest. REUTERS/dado Ruvic/Illustration
BRUSSELS (Reuters) – EU regulators are to investigate Facebook’s (FB.D) the proposed Scale cryptocurrency in order to see whether or not it is harmful to competition, the eu anti-trust regulator said on Monday, in the latest of a watchdog to voice concerns about the social network’s move into the financial services industry.
European Competition Commissioner Margrethe Vestager said the review was warranted, even though it is a new digital currency to be backed by four of the local currency and is available to the billions of Facebook users all over the world, has yet to be released.
“We’ll be able to also have a look at the new services, even before they are implemented. That’s what we’re doing right now, with Facebook’s plans for a new cryptocurrency, which is known as the Scale, which was announced in June,” Vestager said in the text of an address given at a conference to be held in Bergen, Norway.
“We have to look at the question as to whether these proposals will lead to a risk to competition, so we have to be ready to act quickly when an intervention is in order to prove the need,” she said.
Last month, she sent out the questionnaires to the 28 members of the Geneva-based Scale Association was founded to govern the new currency, any questions on the terms and conditions of the membership, according to an EU document seen by Reuters.
The document will also be asked how the Scale-back of products and services will be integrated into the Facebook platform, WhatsApp, Messenger, Instagram and the Calibra, and the manner in which the consumer of the data would be used and who should own it.
Politicians, central bankers and the regulatory watchdogs have, in the past few months, the alarm on the monitor, and the interruption of the risks to the global financial system, and the possibility that it could be used for the purpose of money laundering.
Facebook could not immediately be reached for comment on Wednesday.
Reporting by Foo Yun Chee; Editing by Mark Potter