India hosted the first G20 Finance and Central Bank Deputies meeting under Indian presidency, in Bengaluru in Southern India. Deputies from G20 member countries including 160 foregin delegates and International Organisations were present in the meeting. In this meeting, the member countries revealed a plan on cryptocurrency regulations. The Group of Twenty nations decided to implement a new policy on digital assets.
G20 is a unique intergovernmental forum comprising 19 countries and the European Union.
Together the G20 members represent more than 80% of the world’s total GDP, 75% of international trade and 60% of the world’s population. It is a unique global institution, where developed and developing countries have equal say.
The FTX breakdown has created an atmosphere of doubt and fear among crypto investors and users. The crypto market was filled with uncertainty which is reflecting in crypto asset prices. Investors are afraid to make a move on cryptocurrency after facing huge losses in the recent FTX collapse. To avoid this situation in the future, G20 nations have decided to introduce regulations on crypto assets.
Cryptocurrency Regulations Around The World
The head of the United States is developing crypto regulations in the United States. Recently, the US president directed lawmakers to draft legislation to regulate digital assets in the country.
At first, Biden was not interested in cryptocurrency, but later he signed a document stating that the crypto industry was growing and would need regulations to establish the country as a leader in the digital asset sector. The main regulators in the US that might be involved in the design and enforcement of regulations are the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC)
The US Treasury Secretary, Janet Yellen, officially stated that the country needs rigid regulations for the crypto industry. Lawmakers have seconded Yellen’s statement; many believe it’s time to design and implement new regulations for cryptocurrency.
Kristin Johnson, CFTC commissioner, advised crypto users stating, “I strongly encourage members of the public to stay informed about the potential scams and abuses in the digital assets markets by visiting our investor advisory page.”
Cryptocurrency is considered a legal asset in most of the EU nations. In September 2020, the EU government decided to launch the Markets in Crypto Assets (MiCA) framework. MiCa will help in combating crypto fundraising schemes in the EU nations.
The European Union is preparing a draft to regulate privacy coins in the states. Privacy coins are digital assets that are designed to protect the privacy of users’ ID and transactions. The well known privacy coins Monero, Zcash and Dash are going to be banned in EU nations. Mainly to avoid traceability of the users the EU financial institutions made the decision.
There is no specific law for cryptocurrency in the UK, the country considers crypto assets as property but not a legal tender. And crypto exchanges must register with the UK Financial Conduct Authority (FCA).
Certain regulations on cryptocurrency by the former prime minister of the UK, Boris Jhonson, and former finance minister Liz Truss, have worsened the economic system in Britain. Some of the fintech companies have opened companies outside of Britain due to its strict regulations. Most recently, the United Kingdom added regulations to freeze and recover stolen funds from virtual assets.