The seven largest democracies may push for stricter cryptocurrency regulations at the upcoming G7 summit, according to a March 25 report from Kyoto News Agency.
Leaders from the United States, the United Kingdom, Canada, France, Germany, and the European Union will jointly develop a plan to strengthen consumer protections and increase crypto transparency while addressing potential threats to the world financial system, officials told Kyoto. The meeting for this year is scheduled for May in Hiroshima.
This action follows worries about the threats presented by crypto assets to the global financial system. The collapse of FTX, a significant cryptocurrency exchange, in November highlighted the industry’s inadequate governance and rocked the financial markets.
The G7 wants to lead the development of international guidelines for virtual assets. Japan, which already has cryptocurrency legislation, as well as other nations including the United States, the European Union, Britain, Canada, France, Germany, and Italy, are attempting to express their combined efforts in a leaders’ proclamation.
Japan is one of the G7 nations that have cryptocurrency legislation in place, while the European Union will implement its Markets in Crypto-Assets (MiCA) law in 2024. The United Kingdom is progressively establishing its crypto framework, with the introduction of a dedicated category for cryptocurrency holdings on tax forms and ongoing preparations for a digital pound.
The Financial Stability Board (FSB), which has its headquarters in Switzerland, issued suggestions for the development of a regulatory framework in October of last year, stressing that norms for commercial bank activities should also apply to crypto assets. In July of this year, the FSB intends to release the framework’s final version.
The International Monetary Fund (IMF) has also emphasized important factors that each government should take into account when creating comprehensive and coordinated policies in response to the growth of cryptocurrencies. IMF directors have largely agreed that cryptocurrency assets should not be given official currency or legal tender status, among other rules.
According to the officials, who spoke on the condition of anonymity, topics related to crypto assets are also expected to be on the agenda of the forthcoming conference of finance ministers and central bank governors from the Group of 20 major countries in Washington in the middle of April.