The G20 Group of 20 Industrialized Nations just released an official position on cryptocurrencies. Investors have waited not too patiently to hear what it decided. The verdict is that cryptos can bring significant benefits to the world financial system and the global economy.
The finance ministers and central bank heads Buenos Aires meeting originated this report after the session. Meeting participants are also
seeking digital asset standards to be created.
This report stated “technological innovations, including those that underlie the cryptocurrency, should positively influence the economy.” Then G20 finance minister heads declared their digital currency attitude to be “cautiously optimistic.” It represents a change from past suspicious attitudes of several prominent industrialized nations like Japan and China.
Not All Findings on Cryptos Were Positive
Other findings from the report were less positive. The document declared that digital assets have risks. Some of these are that the cryptos aid criminals in money laundering and tax evasion or tax avoidance. Besides this, they find that they lack the key elements crucial in sovereign currencies.
The G20 also agreed cryptocurrencies are not a clear and present danger to the global financial system now. Regulators will stay vigilant and carefully evaluate the Financial Stability Board (FSB) and Standard Setting Bodies’ reports.
For Better or Worse, Regulation of Cryptos Is At Hand
The central bank heads and finance ministers look for new standards on cryptocurrency assets before November 2018. FATF, the Financial Action Task Force on Combating Money Laundering, is preparing this report. Additionally, the FSB developed a monitoring system for cryptos and their effects on the global financial system in mid-July.
The FSB will routinely update on digital assets and their price volatility in the future. This will cover securities and gold price volatility as well. The FSB will evaluate their function as a transaction instrument along with the levels of institutional investors participating in the space. Meanwhile, news emerged last month that the FATF will create a standard rule book for operating cryptocurrency exchanges.
Proponents of the new regulations believe they will bring much-needed order and also stability to the rising digital asset sector. Critics claim that this is the first move from central banks to control their growing rivals, cryptocurrencies.
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