- During the last G20 meeting, the heads of the 20 world powers noted the “critical” need for international rules and statutes to govern the crypto space to be changed.
- The Financial Stability Board made a series of proposals about possible regulations that would make both crypto firms and markets governed under the same nomenclatures as traditional finance.
- The leaders seek that the crypto environment and everything that surrounds it, have adequate regulation, in addition to adjusting to a supervision that allows reducing the potential risks that they could represent for financial stability.
As if the crisis that the environment of digital assets is going through was not enough due to the bearish period, with pronounced falls that cryptocurrency prices have experienced in recent months, better known as crypto winter, a new scandal has been added to that this sector of digital money is once again in everyone’s sight: the fall and bankruptcy of the FTX firm.
After the recent situation and ordeal that FTX has gone through, many analysts are wondering who will be the next operator to fall, in addition to having increased demands for stricter regulatory controls.
In fact, some analysts have been very critical of it. The economist Nouriel Roubini, known worldwide for predicting the 2008 crisis, he participated in a financial forum in Abu Dhabi, where Roubini described to the entire crypto industry as “an ecosystem that is totally corrupted”, pointing out that it is full of “cheaters, scoundrels, carnies, swindlers and swindlers”.
Cryptocurrencies must be regulated
Among the strongest demands is a high power group, which includes the president of the United States, Joe Biden. During the last meeting of the Group of 20 (G20) the leaders pointed out the “critical” need for the international rules and statutes to govern the crypto space to be modifiedin addition to pointing out the potential risks that this type of digital money represents for “financial stability”.
In this regard, world leaders wrote a release in which they indicated the urgent need to create public awareness related to the threats, in addition to strengthening the regulatory results and assist in the equality of conditions, while taking advantage of the benefits of innovation.
Similarly, last October, the international monitoring body Financial Stability Board (FSB), he pointed a series of proposals about possible regulations that would make both crypto firms and markets governed under the same nomenclatures as traditional finance.
“Awe welcome the approach proposed by the FSB to establish a comprehensive international framework for the regulation of crypto-asset activities based on the principle of ‘same activity, same risk, same regulation’‘, said the G20 leaders.
The leaders seek that the crypto environment and everything that surrounds it, have adequate regulation, in addition to adjusting to a supervision that allows reducing the potential risks that they could represent for financial stability.
“LEffective regulatory and supervisory frameworks should be based on the principle of ‘same business, same risk, same regulation’. When crypto assets and intermediaries perform an economic function equivalent to that performed by instruments and intermediaries in the traditional financial sector, they must be subject to equivalent regulation.”noted the FSB.
The same way, The board integrated stablecoins into its report, noting the need for a review of the recommendations set out in October 2020. In this regard, members of the public have a deadline, until the next December 15 to send you comments on the proposals.
crypto winter
In an attached letter to the G20 dated October 3, klaas knotpresident of the FSB, pointed out and made clear the current situation that the cryptocurrency market is going through:
“The current ‘crypto winter’ has strengthened our assessment of the existing structural vulnerabilities in these markets. Therefore, concerns about the risks they pose to financial stability are likely to resurface sooner rather than later, as are public expectations that policymakers have a robust international framework to identify, monitor, and address those risks”.
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