Global Regulators Release Recommendations on Crypto Assets Regulation
The Financial Stability Board (FSB) and the International Monetary Fund (IMF) have published recommendations that are geared towards regulating digital assets.
This joint initiative aims to produce standards and unify various perspectives in order to help different jurisdictions manage the risks created by crypto-related activities.
According to the report, stablecoin volatility could have an adverse effect on financial stability.
The document further suggested that decentralized finance protocols are not substantially different from their traditional counterparts since they still have comparable liabilities— liquidity and maturity mismatches, interconnectedness, operational fragility, and excessive leverage.
Going further, the report made reference to the IMF’s opinion which favors some kind of regulation for the digital asset sector instead of an outright ban.
To satisfy consumer demands, policymakers should analyze the issues thoroughly.
The publication ended with a roadmap for implementation that includes effective methods to bolster both the institutional capacity beyond G20 jurisdictions and further expand international coordination, cooperation, and data sharing so that the ever-changing landscape remains understandable.
