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FSB: Regulatory Approach to Crypto-assets
Regulatory Approach to Crypto-assets
3rd June 2019
On Friday (31st May 2019), the Financial Stability Board (FSB) published a report on Crypto-assets that provided an update to G20 Finance Ministers and Central Bank Governors ahead of their meetings next week and sets out details of work being undertaken by international supervisors, including the Basel Committee, IOSCO, FATF, OECD and of course the FSB.
On the work being undertaken by international organisations, the FSB’s report informs that works are mainly focused upon the following areas:
In addition to monitoring and analysing developments in these markets, setting supervisory expectations for firms and clarifying how international standards apply to crypto-assets.
The report however also notes concerns over potential oversight gaps, proposing that “Assessing the significance of potential gaps is challenging, given the rapidly evolving nature of the crypto-asset ecosystem and related risks. A forward-looking approach to monitoring crypto-assets can help provide a basis for identifying potential gaps and areas that should be prioritized or focused on.”
Whilst gaps may arise from the absence of international standards or recommendations, these may also arise in cases where such assets are outside the perimeter of market regulators and payment system oversight, which to some extent, may actually reflect the nature of so-called crypto-assets that may have been designed to work outside established regulatory frameworks.
In conclusion, FSB’s recommendation is that G20 ensure that the regulatory approaches and potential gaps, including questioning whether greater co-ordination is needed as a topic under review.
And so it seems, that as anticipated for the last year or so, greater regulation of so-called crypto-assets is well and truly on the horizon!
To read the FSB’s full report, click here.
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