G20 defines crypto as assets not currencies
However, G20 ministers acknowledged that “at some point they could have financial stability implications”.
Finance ministers and central bank governors at the G20 Summit have declared that they don’t consider cryptocurrencies to be currencies at all, but rather assets, calling for continued monitoring and reviews.
During the meeting in Argentina this week, the Group of 20 Economies (G20) signaled that crypto assets, such as bitcoin, Ethereum and other so-called digital currencies, “lack the key attributes of sovereign currencies”.
Below is an excerpt from the official communiqué released by the G20 Summit 2018.
We acknowledge that technological innovation, including that underlying crypto-assets, has the potential to improve the efficiency and inclusiveness of the financial system and the economy more broadly. Cryptoassets do, however, raise issues with respect to consumer and investor protection, market integrity, tax evasion, money laundering and terrorist financing. Crypto-assets lack the key attributes of sovereign currencies. At some point they could have financial stability implications. We commit to implement the Financial Action Task Force (FATF) standards as they apply to crypto-assets, look forward to the FATF review of those standards, and call on the FATF to advance global implementation. We call on international standard-setting bodies (SSBs) to continue their monitoring of crypto-assets and their risks, according to their mandates, and assess multilateral responses as needed.
“Whether you call it crypto assets, crypto tokens – definitely not cryptocurrencies – let that be clear a message as far as I’m concerned,” De Nederlandsche Bank NV president Klaas Knot said, according to a report published by Bloomberg. “I don’t think any of these cryptos satisfy the three roles money plays in an economy.”
However, the G20 ministers acknowledged that “at some point they could have financial stability implications”.
In a press conference following the meeting, Argentina’s treasury minister Nicolás Dujovne revealed that the G20 “received a strong mandate that it’s [crypto assets] an issue to be closely looked at.” He said that regulation, markets, cybersecurity, data, transactions, security, money laundering and more were discussed.
“Now that we have crypto assets, what happens to traditional methods of payments?” was one of the leading questions posed during the meeting, according to Dujovne. “We talked about methods of payments, systems of payment, to improve multilaterally at an international level these integrations.”
“On this theme…. there is a demand in July to have specific recommendations on what to do,” Dujovne added.
Earlier this week, the Financial Stability Board (FSB), a global regulatory body that monitors financial susceptibility for the G20, determined that the burgeoning cryptocurrency industry is not currently a liability to global financial stability. However, the FSB said crypto assets do require further observation and investigation.
“The FSB’s initial assessment is that crypto-assets do not pose risks to global financial stability at this time. This is in part because they are small relative to the financial system,” FSB chairman Mark Carney said.
“Crypto-assets raise a host of issues around consumer and investor protection,” he added. These include money laundering and terrorist financing activities. “At the same time, the technologies underlying them have the potential to improve the efficiency and inclusiveness of both the financial system and the economy.”
To support monitoring and timely identification of emerging financial stability risks, Carney revealed that the FSB plans to identify enhanced metrics and tools to fill any existing or future cryptocurrency data gaps.
The G20 Summit 2018, held in Buenos Aires March 19-20, is addressing issues such as international financial architecture, the global tax system, financial regulation, plus cryptocurrencies and supported technologies.
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