G20 leaders call for regulation on stablecoins before approval

G20 leaders call for regulation on stablecoins before approval - g20 flags logo 900x506 1At the fourth meeting of G20 finance ministers and central bank governors, the authorities called for more oversight on stablecoins and measures to ensure compliance. The meeting follows calls from many governments for more regulation for the niche.

Definition of standards for digital assets

The report labels stablecoins as “not so” global stablecoins, which require the aforementioned legal, regulatory and supervisory requirements that must meet applicable standards. It asks competent authorities to make changes to meet these standards, which will then inform the FSB in its next recommendation guideline, scheduled for 2023.

More generally, the meeting called for the definition of standards for digital assets and related service providers, which several governments are currently examining. The Financial Action Task Force (FATF), which talked about money laundering and terrorist financing, will be at the center of this resolution.

The results of a survey published earlier by the FSB also suggested that stablecoins had not reached an appreciable level of use for traditional payments. However, that doesn't stop them from wanting to nip the alleged problem in the bud.

Lawmakers have goals set on stablecoins

Stablecoins have emerged as a major concern for governments. Regulators have discussed this on a global and individual government level. A major concern regarding stablecoins is the advantage it has over central bank digital currencies (CBDCs), which are likely to take years to achieve global adoption.

Among the many countries that have begun to look into surveillance measures for stablecoins is the United States. The US Treasury is reportedly working on regulating stablecoins, even before there is a final word on regulation for the market as a whole.

Establishing regulation for the entire cryptocurrency market is challenging and may require a coordinated international effort. But authorities are keen to eliminate the threat stablecoins pose to national currencies as quickly as possible, hence the sudden focus on the niche. Regulation of stablecoins around the world is currently patchy, but is changing rapidly.

Who will be launching their first digital currency?

We know for sure that many nations are working on it, but China seems to be the one ahead of all, as it would also like to launch it publicly in the next Winter Olympics. Athletes would therefore act as "guinea pigs" to experience a CBDC for the first time in the world.

However, even if a little behind the Chinese, the Americans (United States area) are also working on it. And the European bank is also thinking of launching a digital euro. However, no one has yet said they want to introduce Bitcoin as legal tender. as did El Salvador with its far-sighted president.