Global Regulators Haven’t Properly Addressed Stablecoins

Published at: Feb. 21, 2020

Facebook’s plans to launch its cryptocurrency Libra this year has more than a few agencies in the European Union and the United States wondering what to do. While government bodies around the world are working to better understand crypto, regulations and laws pertaining to stablecoins aren’t being implemented quickly enough, according to a global finance watchdog.

In a letter to finance ministers and central bank governors from the G-20 meeting in Riyadh this week, Financial Stability Board (FSB) Chair Randal Quarles voiced his concerns regarding how quickly digital currencies are affecting the global economy while regulatory action struggles to keep up. 

“FSB members recognise the speed of innovation in the area of digital payments, including so-called ‘stablecoins’. We are resolved to quicken the pace of developing the necessary regulatory and supervisory responses to these new instruments.”

Regulatory response to cryptocurrency around the world 

The FSB is considering a public consultation on such regulations in April to evaluate the benefits and risks of stablecoins. Unregistered crypto companies continue to operate in Europe, while some exchanges in Brazil have been forced to shut down due to fines brought on by regulatory enforcement. 

Consisting of regulators, bankers and government officials from the G-20 countries, the FSB was established in 2009 as an early warning system in the event of another potential global financial crisis.

Tags
G20
Related Posts
Better regulation needed to stop crypto tax evaders from running wild
Antivirus software pioneer John McAfee, the founder of McAfee Associates — the company that released the first commercial antivirus software, McAfee VirusScan, in the late 1980s, contributing to the birth of multibillion-dollar industry — was indicted on five counts of tax evasion and five counts of willful failure to file a tax return, which could result in a maximum sentence of 30 years if convicted. He could also expect to pay U.S. taxes and penalties, according to the United States Department of Justice. The DOJ’s charges were announced shortly after the U.S. Securities Exchange Commission revealed it had brought civil …
Blockchain / Oct. 10, 2020
FSB, IMF and BIS papers to set global crypto framework, says G20
The Financial Stability Board (FSB), the International Monetary Fund (IMF), and the Bank for International Settlements (BIS) will deliver papers and recommendations establishing standards for a global crypto regulatory framework, announced on Feb. 25 the group of the 20 biggest economies of the world, collectively known as G20. According to a document summarizing the outcomes of the meeting with finance ministers and central bank governors, the FSB will release by July 2023 recommendations on the regulation, supervision and oversight of global stablecoins, crypto assets activities and markets. The next guidance is expected for September 2023, when the FSB and the …
Adoption / Feb. 26, 2023
What the SEC can learn from the German regulator
The United States Securities and Exchange Commission’s chairperson Gary Gensler announced this month that the crypto industry should not escape the purview of the regulator. He highlighted that decentralized finance (DeFi) trading and lending protocols need particular attention when it comes to investor protections. Regulation can extend into a menu of options that covers custody, reporting, counterparty verification and asset classification and issuance. Reports are surfacing that people are waiting with bated breath on how the SEC will regulate the DeFi industry, but Germany's Federal Financial Supervisory Authority, also known as BaFin, has found a way to apply existing securities …
Technology / Aug. 12, 2021
XRP purchasers back Ripple, arguing that it is not a security
On Dec. 22, 2020, the United States Securities and Exchange Commission filed a complaint against Ripple Labs. The complaint essentially alleged that Ripple had engaged in a multi-year, sustained practice of illegally selling unregistered, non-exempt securities in the form of its XRP tokens. This complaint, having been filed on the last day of former SEC Chairman Jay Clayton’s tenure at the commission, led to a considerable volume of public commentary, as is not unusual for SEC litigation against major players in the crypto space. What is unusual about SEC versus Ripple is the reaction from a sizable segment of XRP …
Technology / March 21, 2021
How the Democratic Party didn’t stop worrying and fearing crypto in 2021
As 2022 is kicking off, America nears the first anniversary of Joe Biden’s presidency. Following the tenure’s ambitious start, the last few months witnessed some serious tumult around the overall health of the United States economy, the administration’s handling of the COVID-19 pandemic, and the tense debate around Biden’s opus magnum — the $1.7 trillion Build Back Better infrastructure legislation plan. But even as the Democrats’ ability to maintain undivided power after the 2022 midterm elections can raise doubts, the party’s prevailing view of crypto has become more consolidated than ever. The incumbent president’s party will be setting the tone …
Regulation / Jan. 1, 2022