IMF Crypto Regulation Calls at G20 Summit 2023
The IMF has shared its views on the need for crypto regulation during a meeting of senior government officials from around the world.
At the G20 Summit 2023 in Bengaluru, India, on 24-25 February 2023, all G20 Finance Ministers and Central Bank Governors met in the quest to encourage global economic stability and growth by facilitating cooperation and dialogue among G20 members (19 countries and the European Union).
Many topics were discussed, including a modern international tax system. One topic which caught our attention was crypto regulation. Managing Director of the IMF (International Monetary Fund), Kristalina Georgieva, called for greater private crypto regulation, citing the risk of financial stability.
IMF crypto regulation calls
Georgieva shared the IMF crypto regulation view at a press briefing during the G20 Summit 2023 in Bengaluru and stated that “private crypto assets are not money”.
She urged regulators to implement stricter measures, asserting that if regulation fails or is implemented too slowly, then "we should not take off the table banning those assets", adding they could create a "financial stability risk".
Georgieva underlined that the IMF, joined by the Financial Stability Board alongside the Bank for International Settlements, is devoted to establishing a foundation for regulating crypto assets not issued by central banks or governments.
Georgieva said, "We have to differentiate between central bank digital currencies (CBDCs) that are backed by the state and stablecoins, and crypto assets that are privately issued."
To summarise, according to Georgieva, regulating (or potentially banning) private cryptocurrencies is important, as they can pose significant risks to financial stability. The IMF, BIS, and FSB are working towards establishing a regulatory foundation for private crypto tokens.
This is not a new theme of discussion. Several countries are actively working towards a stringent regulatory environment for cryptocurrencies.
Following US President Joe Biden's executive order in March 2022, for example, arrangements towards greater crypto regulation were accommodated in the 2023 budget proposal (also released in March 2022). A framework was brought forward in September 2022 based on the executive order.
The UK plans to make digital assets a regulated financial instrument. The Swiss government has already inculcated a mature cryptocurrency framework into its regulatory system.
India has a strict crypto taxation framework, while the United Arab Emirates is assembling an authority focused solely on digital currencies. It is safe to say that cryptocurrency regulation is underway, whether you like it or not.
Author: Surajdeep Singh
Surajdeep Singh has been working in the tech sphere as a marketing guru and journalist for over 6 years, with his speciality laying in blockchain and Web3. He has donned several hats in marketing and journalism over the years and worked with many reputable brands. Feel free to reach out to him on LinkedIn!