Mohith Agadi
According to the G20 Chair’s Summary and Outcome Document from the First G20 Finance Ministers and Central Bank Governors Meeting held in Bengaluru on February 24-25, 2023, The G20 has welcomed the ongoing work by the Financial Stability Board (FSB) and international standard setters to ensure that the crypto-assets ecosystem, including stablecoins, is closely monitored and subject to robust regulation, supervision, and oversight to mitigate potential risks to financial stability.
In the first G20 finance ministers and central bank governors meeting held in Bengaluru on February 24-25, 2023, the leaders welcomed the FSB’s analytical report on decentralized finance (DeFi) and expressed their anticipation of the FSB’s high-level recommendations for the supervision and regulation of stablecoins and crypto assets by their third meeting in 2023.
The G20 leaders also appreciated the IMF Discussion Paper on the macro-financial implications of crypto assets and looked forward to the IMF-FSB Synthesis Paper that would support a coordinated and comprehensive policy approach to crypto-assets by considering macroeconomic and regulatory perspectives, including the full range of risks posed by crypto assets.
Moreover, the G20 nations took note of the G20 seminar on “Policy Perspectives: Debating the Road to Policy Consensus on Crypto Assets,” further signaling their intent to develop a comprehensive regulatory framework for crypto assets.
The G20 leaders recognized the potential of crypto assets and stablecoins to drive innovation in the financial sector but cautioned that they must be subject to robust regulation and supervision to prevent financial instability. They underscored the need for coordinated and comprehensive policy approaches to ensure that the benefits of crypto assets are not outweighed by their risks.
The G20 leaders’ commitment to a coordinated approach to regulating crypto assets and stablecoins will be welcomed by investors and market participants who have long sought clarity on the regulatory framework for these emerging assets.
Damodar Kalyan
