G20 on supervising firms that invest in cryptocurrencies.
Crypto players have not been allowed to argue about the lack of regulation clarity.
The G20, an intergovernmental forum, has stated that globally agreed rules leave crypto firms with no option. However, it will introduce a basic safeguard to avoid the blowups experienced at the FTX exchange and other crypto firms.
On July 17, the Financial Stability Board (FSB) revealed the final recommendations by the G20 on supervising firms that invest in cryptocurrencies. Moreover, the watchdog also updated the existing recommendations for stablecoins like TerraUSD/ Luna Coins. The G20 revealed this update after the report that the G20 will meet in India to discuss the game-changing crypto regulations.
G20’s FSB Brings Clear Standard Crypto Regulations
The FSB report highlighted the FTX collapse that happened in 2022 and the vulnerabilities of crypto firms. It stated that all countries should follow the recommendations, even those not included in the watchdog’s members. The FSB added that recent events have shown that if linkages to traditional finance were to grow further, spillovers from crypto markets into the broader financial system could surge.
John Schindler, FSB secretary general, stated that the crypto firms have to stop operating outside the regularity perimeter or not cooperate with the existing rules. Moreover, those players have not allowed to argue about the lack of regularity clarity, as the framework has set a clear standard.
Financial stability clearly focuses on robust governance to prevent conflicts of interest and proper risk management. This is to ensure customer money segregated from the company’s cash. Moreover, the European Union has already approved the world’s first comprehensive set of rules for the crypto market. However, the FSB global baseline set to created to accommodate jurisdictions.
