<\/p>\n
At the upcoming G20 summit<\/strong>, bringing together heads of state, finance ministers, and central bank governors from industrialized and emerging countries, crypto-currency will be one of the hot topics.<\/strong> Indeed, if the crypto-sphere is a promising market, it is however confronted with a major problem: the lack, or even total absence of regulation.<\/strong> Some crypto platforms thus easily escape sanctions as well as taxes.<\/p>\n <\/p>\n According to Klaas Knot<\/strong>, Chairman of the Financial Stability Board<\/strong> (FSB), who is also a member of the Governing Council of the European Central Bank<\/strong> (ECB) and President of the Dutch Central Bank<\/strong>, the “crypto winter”<\/em> (a sharp and sustained fall in crypto-currencies)<\/em> has led the board to investigate the current structural vulnerabilities of the currency.<\/p>\n <\/p>\n <\/p>\n The total capitalisation of the sector, which in November 2021 had reached some 3 trillion dollars, has thus melted down to around 935 billion dollars at present.<\/strong> The FSB believes that this fall is not large enough to threaten financial stability but that rules are needed to regulate a likely recovery.<\/p>\n <\/p>\n “Concerns about the risks to financial stability are therefore likely to return to the forefront soon,”<\/em> writes Klaas Knot in a letter to the G20 finance ministers meeting in Washington in October.<\/strong><\/p>\n <\/p>\n The FSB thus recommends setting up a supervisory and risk and data management framework for cryptoasset firms.<\/strong> “Several cryptoasset firms have failed in the recent market rout due to liquidity vulnerabilities, undercapitalisation, concentrated exposures to risky entities and risky trading and commercial activities,”<\/em> notes the FSB.<\/p>\n <\/p>\n The proposals have been put out to public consultation until 15 December and are to be finalised in 2023.<\/p>\n <\/p>\n <\/p>\n India, for its part, maintains a strict stance against crypto-currencies.<\/strong> And as the future host of the G20 summit (September 2023), it is likely to strongly defend its convictions in Bali. India’s Home Minister Amit Shah<\/strong> has even said that crypto-currencies are responsible for the increase in drug smuggling in India.<\/p>\n <\/p>\n The Financial Action Task Force<\/strong> (FATF), an intergovernmental body that fights money laundering and terrorist financing, is set to step up its fight by committing to annual checks to ensure that countries are implementing anti-money laundering rules.<\/strong> Countries that fail to comply with these checks will be placed on a “grey list”<\/em> and those that continue to fail to cooperate in the fight against money laundering will be placed on a “black list”<\/em> and be subject to economic sanctions by the FATF.<\/p>\n <\/p>\n <\/p>\nInstability<\/h2>\n
Rules to be put in place<\/h2>\n