The Financial Stability Board (FSB) Releases Global Regulatory Framework for Crypto Asset Activities
The Financial Stability Board (FSB) has completed its global regulatory framework for crypto asset activities, aiming to enhance the consistency and comprehensiveness of regulatory and supervisory practices on an international scale. The framework is built on the principle of ‘same activity, same risk, same regulation’ and establishes a foundation for consistent and comprehensive regulations for crypto asset activities and stablecoins.
Key Points:
– The FSB released a public note and two guideline documents on the regulation of cryptocurrencies and global stablecoins.
– The guidelines include recommendations for crypto regulation in general and revised recommendations specifically for global stablecoins.
– Crypto platforms should segregate clients’ digital assets from their own funds and establish clear functional separations to avoid conflicts of interest.
– Local regulators need to prevent activities that impede the identification of responsible entities, including decentralized finance (defi) protocols.
– Global stablecoin issuers may need to obtain permits to operate in each jurisdiction.
Next Steps for the FSB and Collaboration with IMF
The next steps for the FSB include reviewing the global implementation of the recommendations by the end of 2025. They will also collaborate with the International Monetary Fund (IMF) to produce a report on current policies and challenges, which will be presented to the G20 in September.
Hot Take:
While the FSB’s regulatory framework is a positive step, it is important to note that the board does not have direct regulatory authority over cryptocurrencies. Their recommendations serve as guidance to global financial regulators in formulating effective regulatory measures. Collaboration with the IMF and continued review of implementation will contribute to the development of a comprehensive regulatory framework for crypto assets.
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