In its two newly released reports, the International Monetary Fund (IMF) has called on the Financial Stability Board (FSB) to coordinate with governments of G20 nations to help them formulate their crypto policies.
As per the IMF, the FSB is in a good position to take the lead in coordinating and creating international norms to encourage sustainable regulation of crypto assets. It is also in a good position to direct national regulation of crypto assets while taking into account industry-specific standards.
This is not the first time that the IMF has mentioned its trust in FSB. In December 2021, the IMF called upon the FSB to formulate a regulatory framework for digital assets. After the 2008 housing market crisis, the FSB was created out of necessity, as a successor to the Financial Stability Forum (FSF).
In October, the FSB should get in touch with G20 finance ministers and their central banks to give them “high-level recommendations regarding cryptocurrencies— especially stablecoins. This was mentioned by the FSB in its statement from summer.
The creation of universal categories to develop cross-sectoral standards and direct data collecting is one of the measures outlined in the reports. Additionally, they suggest a risk-based strategy with distinct requirements for “entities and activities that generate higher risk” and suggest that stablecoins should be backed by liquid and secure assets.
The IMF has warned several non-G20 member nations against the integration of cryptocurrencies in the general economy. The international organization has warned nations like El Salvador and the Central African Republic to take a U-turn on their decision to declare Bitcoin as a legal tender. They assert great concerns regarding the volatility of the crypto market and the chances of criminals misusing the anonymity offered by crypto.