The Financial Stability Board (FSB) of the G20 announced the need to regulate the cryptocurrency sector, including with regard to the phenomenon of so-called ‘stable currency‘. Such as Luna, a cryptocurrency that in theory should have been pegged to the value of the dollar and has recently exploded miserably.
Cryptocurrencies and the markets in which they operate must be subject to effective regulations and must also be constantly monitored. This is in proportion to the high risk they pose, both nationally and internationally. Crypto assets and the markets in which they operate often serve the same functions as the products and intermediaries of the traditional financial sector. Hence the need to subject them to the same relevant rules that apply to traditional products. Crypto assets are mainly used for speculative purposes, but many products trade outside of regulations to protect investors
reads the strict stance of the FSB.
The cryptocurrency, including so-called stablecoins, are evolving rapidly. The recent turmoil in the cryptocurrency markets highlights their inherent volatility, structural vulnerabilities and the problem of their growing interdependence with the traditional financial system. (…) The risks of crypto assets can quickly transfer to other parts of the economy and traditional finance
the press release continues.
Hence the need to arrive at a common framework of clear rules shared by all G20 member states. Although the FSB does not have the power to take legislative initiative, the body can still adopt directives which are then, in principle, implemented by the member states and transposed into national law.
Source: Lega Nerd
