The G20, an International forum for the Finance Ministers and Central bank Governors had held a summit recently at Buenos Aires, Argentina to discuss the global economic stability. The summit had bought together the head of States and Global financial leaders and marked the union of representatives from 19 nations. Discussion on crypto was one of the top highlights.
In the summit, the members of G20 have explained their optimistic view towards Cryptocurrency in the global economy. The members are of the view that the developments in crypto technology will bring “significant benefits” to the economy.
“Technological innovation including those underlying crypto-assets can deliver significant benefits to the financial system and the broader economy. However, the official document throws light on the need to protect the investors and consumers”.
The G20 communique on crypto was one of the highlights. G20 summit is an excellent platform to discuss a country’s financial and economic cooperation. Participating nations represent 85% of the world’s economic output, two-thirds of its population and 75%of international trade.
The countries had a discussion on the financial stability of the economy and remarked that currently crypto-assets made the global economy free from financial stability risk and the global body remains vigilant. The same was quoted in the official communication which deals with “the future of work, infrastructure for development and sustainable food future”.
Though the committee mentioned the brighter side of crypto-asset, they also considered the risks associated with the digital currencies and stated that:
“crypto-assets do, however, raise issues with respect to consumers and investors, protecting market integrity, tax evasion, money laundering and terrorist financing. Crypto-assets lack the key attributes of sovereign currencies. While crypto-assets do not at this point pose a global financial stability risk, we remain vigilant”.
The report mentioned that even though technology and cryptocurrency offer opportunities for growth and innovation, it noted that the risks of instability, scams and fraud do exist in the new market.
October: Deadline for FATF
To stay vigilant on digital currencies, the members of G20 has expressed their trust on Financial Action Task Force(FATF) -an intergovernmental body that was formed to fight money laundering and terrorist financing. The G20 members further ask the FATF to explain how its existing standards can be applied to cryptocurrencies within 3 months.
Before the summit had concluded, G20 members declared October as a deadline to analyze the worldwide anti-money laundering guideline. The report added “we welcome updates provided by the FSB and the SSB’s and look forward to their further work to monitor the potential risk of crypto-assets and to assess multilateral responses as needed. We reiterate our march commitments related to the implementation of the FATF standards and we ask the FATF to clarify in October 2018 how its standards apply to crypto-assets”.
The Financial Stability Board (FSB) which focuses on economic development and stability had submitted their reports on crypto-assets which include blockchain and cryptocurrency. In the report, they mentioned the risks associated with ICOs and revealed the common tactics practised by the traders to calculate the altcoin prices.
They have informed that they had developed a framework in collaboration with the Committee on Payments and Market Infrastructure (CPMI). Despite this, the committee as a whole said that they find alt-currencies to be more “fruitful than harmful”.