Bitcoin and crypto investors were put on notice this week when French and German government officials backed European Central Bank (ECB) plans for the development of a rival to Facebook’s libra and bitcoin.
The ECB has said it’s planning a public digital currency that could leave Facebook’s libra dead in the water.
However, the most serious new threat to bitcoin, cryptocurrency, and the likes of Facebook’s libra, is from Danish politician Margrethe Vestager, who was this week appointed the European Commission’s executive vice president for digital, as well as retaining her role as the E.U.’s competition commissioner.
Earlier this week, both France and Germany said they could block Facebook’s libra in Europe due to the risks it poses to the financial sector while backing the ECB’s proposed development of an alternative public cryptocurrency.
“France and Germany consider that the libra project, as set out in Facebook’s blueprint, fails to convince that those risks will be properly addressed,” France’s Finance Minister Bruno Le Maire and his German counterpart, Olaf Scholz, said in a joint statement issued at a meeting of eurozone finance ministers in Helsinki, it was first reported by Reuters, a newswire.
In June, social media giant Facebook revealed plans for its libra digital currency, something it wants to serve as a global currency, putting it in direct competition with U.S. dollar and provoking the ire of U.S. president Donald Trump.
ECB board member Benoit Coeure, meanwhile, branded Facebook’s libra plans “a wake up call” that would spurring action from the E.U. to create its own bitcoin rival, adding: “We need to step up our thinking on a central bank digital currency.”
“We encourage European central banks to accelerate work on issues around possible public digital currency solutions,” Le Maire and Scholz said.
The bitcoin price has soared so far this year, climbing some 200% as expectations around Facebook’s libra, and bitcoin and cryptocurrency interest from some of the world’s biggest technology companies, has driven a fresh wave of bitcoin investment.
The power of predominantly U.S. tech giants has caused consternation among many European countries in recent years, with Margrethe Vestager taking action against Facebook, iPhone-maker Apple, and search titan Google.
Vestager’s enthusiastic pursuit of these companies has lead to accusations she hates the U.S. from president Trump.
In a worrying development for the likes of Facebook and other ambitious technology companies, Vestager has this week been put in charge of revamping how the E.U. regulates the digital world, and has unparalleled control over the bloc’s bitcoin and crypto policy.
“Margrethe Vestager will coordinate the whole agenda and be the commissioner for competition,” Ursula von der Leyen, the E.U. Commission president-elect, told reporters on Tuesday. “She will work together with the internal market, innovation and youth, transport, health and justice.”
Elsewhere, bitcoin and crypto investors and companies can take some solace in the E.U.’s financial services commissioner, Latvia’s Valdis Dombrovskis, who has appeared approving of bitcoin and cryptocurrencies in the past.
Earlier this year, Christine Lagarde, who is set to replace Mario Draghi as president of the ECB, warned that cryptocurrencies are “shaking the system”—something that could signal a change in the ECB’s approach to bitcoin and crypto and potentially spur adoption.
Facebook applied for a payment service license for libra this week in Switzerland, though regulators warned libra could face rules that typically apply to banks.