Regulatory Body of G20 Rejects Cryptocurrency RegulationApril 7, 2018
The board that’s responsible for coordinating financial regulation for the G20, the Financial Stability Board, rejects calls for members to regular cryptocurrencies. The board decided that it does not currently pose any significant risk or issue to global financial stability. Even if they did not regulate digital currencies, they will closely watch the market, saying that it is still a sector with less than one percent of the global GDP.
Every time the subject in relation to regulating cryptocurrency comes up, there are a lot of different opinions. Some think that regulation is not necessary and irrelevant, as digital currencies cannot be regulated in the first place. Without central company or authority to provide access to this form of money, there are not many regulators that regulators can do. It is also not the right course of action to go after the service providers within the industry, as it will also irk consumers.
G20 seems to agree with this sentiment. The board has officially rejected the need to regulate cryptocurrencies. The decision comes as a surprise, as both Germany and France were adamant about putting Bitcoin regulation on the agenda of G20.
The chairman of the board and the Governor of the Bank of England, Mark Carney, wrote to the leaders of G20 just before heading off to their 2-day summit. In the letter, it said that cryptocurrencies don’t pose any risk on the financial systems of the world. Then, they all have come to a conclusion and rejected the call for the regulation of the industry of cryptocurrency, moving forward. This means that there will be no new regulations for altcoins or Bitcoin anytime soon. The issue could still be revisited, but many cryptocurrency enthusiasts can breathe for a while.
However, Carney was openly in favor of the regulation. In his speech earlier in March, he stated that regulating the elements of the ecosystem of cryptocurrency will combat any illicit activities, protect the soundness and safety of the financial system and promote the integrity of the market. He also suggested that whoever his successor will be would be leading a financial watchdog that is more focused on reviewing the rules instead of pushing through new standards.
Rejecting the call for cryptoccurency regulation from finance ministers and the leading central bankers is a new trend. This is especially true since the president of the United States, Donald Trump ordered regulators of America to scale back on it. The board now presents itself as a disciplined, efficient and an open body that has scrapped a quarter of its groups.
The world of cryptocurrency might no longer be a new concept, but there is still a lot of room for improvement in the underlying technology. Regulating cryptocurrency might be the last thing this new industry needs at this time. There are still several things to develop and work on before they can focus on regulating digital currencies.