FSB Finalizes Global Regulatory Framework for Crypto-assets: Same Activity, Same Risk, Same Regulation

The Financial Stability Board (FSB) Releases Global Regulatory Framework for Crypto-Assets

The FSB has announced the finalization of a global regulatory framework for crypto-asset activities, with the aim of promoting comprehensive and internationally consistent regulation. The framework is based on the principle of ‘same activity, same risk, same regulation’ and incorporates insights from the past year’s events in crypto-asset markets and feedback received during public consultation.

Key Points

The framework consists of high-level recommendations for the regulation, supervision, and oversight of crypto-asset activities and markets.
A second set of recommendations focuses on the regulation, supervision, and oversight of “global stablecoin” arrangements.
The recommendations draw on implementation experiences and principles such as ‘same activity, same risk, same regulation’ and are technology neutral.
The FSB has strengthened recommendations in areas such as safeguarding client assets, addressing conflicts of interest, and strengthening cross-border cooperation.
The framework does not comprehensively cover all specific risk categories related to crypto-asset activities and excludes Central Bank Digital Currencies (CBDCs).

What’s Next

The FSB and standard-setting bodies will continue to coordinate in promoting globally consistent regulation. They will consider the need for further guidance or standards and monitor implementation status at the jurisdictional level. The FSB has collaborated closely with sectoral standard-setting bodies and international organizations to ensure a coordinated and complementary approach to monitoring and regulating crypto-asset activities and markets.

Hot Take

The FSB’s global regulatory framework for crypto-assets is a significant step towards ensuring comprehensive and consistent regulation in the crypto industry. By addressing key areas such as safeguarding client assets and cross-border cooperation, the framework aims to enhance financial stability. However, it is important to consider the evolving nature of the crypto market and the need for ongoing monitoring and adaptation of regulatory measures to effectively mitigate risks.