Washington (AFP)

Donald Trump's finance minister, Steven Mnuchin, issued a warning to Facebook on Monday over his Libra cryptocurrency project, as the government feared that such a virtual currency could be used to launder money or trick the taxman.

"The Treasury has very serious concerns about the Libra, which can be misused to launder money or finance terrorism," Mnuchin said.

He added that Facebook "was going to have a lot of work to do to convince" the Trump administration that it can set up this currency safely.

The latter will have to "respect a very high level" of regulation, he insisted.

Mnuchin was speaking at the White House the day before a hearing in the Senate of Facebook's leader, David Marcus, in charge of the virtual money project.

He recalled that bitcoin, the first and largest cryptocurrency, had been exploited in multi-billion dollar illicit activities ranging from tax evasion to extortion and drug trafficking. He also said he was "worried" about the speculative nature of bitcoin.

While the Treasury welcomes "responsible innovation" that can improve the efficiency of the financial system, "the goal of the ministry," says Mnuchin, "is to maintain the integrity of the financial system."

"It is my responsibility to protect our currency," said the Minister of Finance.

- "National Security" -

The integrity of the currency is "a matter of national security," Mr Mnuchin added, adding that the Treasury "took the role of the dollar as a reserve currency very seriously and would continue to protect the country and secure the financial system. ".

He admitted to being "not very comfortable" with Facebook's idea of ​​virtual currency adding that "the group and others had a lot to do to reassure us".

The minister said he has formed a working group on the subject within the FSOC, a body chaired by the Treasury that includes the country's main financial regulators (Fed, CFTC, SEC ..).

The creators of virtual currencies "will have to apply the same anti-money laundering, anti-terrorist financing measures as the traditional financial institutions", warned Mr. Mnuchin, subjecting these new actors to the same regulations as the banks.

For its part, the social network Facebook promised that it would not launch its currency before having answered all the concerns of the regulators, according to the promises of project manager within the American group, David Marcus.

"We know that we need to take the time to do things right, and I want to be clear: Facebook will not offer Libra digital currency until it has answered all regulatory concerns and received all the appropriate authorizations ", is it written in the text of its hearing that it must pronounce Tuesday, made public as of Monday.

The cryptocurrency, promised for 2020 by Facebook, raises more and more concerns not only among US regulators but also internationally.

The subject is even on the agenda of a meeting of G7 finance ministers to be held Wednesday and Thursday near Paris, as recalled by Mnuchin.

US Central Bank (Fed) President Jerome Powell warned on Thursday that the regulators' study of the project would take more than a year.

Mr. Powell "made it clear that the review (...) should take time and be thorough rather than being a sprint before the project is implemented," acknowledges Mr. Marcus in his testimony. "We totally agree."

With the creation of this digital currency offering a new payment method outside traditional banking channels, announced in mid-June, Facebook wants to upset the global financial system.

© 2019 AFP