Union Finance Minister Nirmala Sitharaman on Thursday (April 13) said that a consensus has been reached among G20 countries that any action on crypto assets will have to be global.
Speaking on the sidelines of the annual spring meeting of the International Monetary Fund (IMF) and the World Bank in Washington, Sitharaman said members of the G20 agree that a globally coordinated understanding would be required not only to deal with the challenges posed by crypto assets but also to regulate them.
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The grouping has responded to the issue with alacrity and during India’s presidency of the G20, a “synthesis paper” will be taken up on matters related to crypto assets, she told reporters.
“I am glad to say that there is a greater acceptance among all G20 members, that any action on crypto assets will have to be global,” Sitharaman said adding, “the G20, I think, has responded fairly with alacrity (on the crypto challenge).”
Sitharaman on Thursday co-chaired a meeting of finance ministers and central bank governors from member countries with Reserve Bank of India Governor Shaktikanta Das.
Issues related to crypto currency and its challenges were discussed at the meet.
“The G20 and its members agree that it’s not going to be possible to have an independent standalone country dealing with the crypto assets and that it has to have a globally coordinated understanding on how to go about regulating crypto assets,” she said in response to a question.
“The way in which we are seeing this pan out during our presidency is the IMFs paper is being discussed, FSBs (Financial Stability Board) paper also will be taken up, and a synthesis paper will be prepared from the IMF paper and the FSB paper both put together,” Sitharaman said.
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There will be a discussion in September and October, and in the “end of the day, we will see a roadmap being readied on how and what kind of understanding the members of the G20 have in this, and it can be taken further forward on specific actions of regulation as and when the G20 takes a call on it”, the finance minister said.
Noting that she does not want to pre-empt a decision, Sitharaman said the work done by the FSB and the IMF indicate that crypto assets, particularly those that are outside of central banks, being not backed by any sovereign asset, can cause macroeconomic instability.
“So, today, we are in the position to see how countries are now recognising that it is not just a crypto asset regulatory issue, where countries will have to come together, but the IMF dealing with it has also brought in this time mention that they can be issues of macro-economic stability itself,” she said.
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“Today, I am very glad to have heard the European Central Bank chief Christine Lagarde speak about specific examples of how money has been routed into this operation, resulting in too many such companies who are getting involved in it raising questions of where the trail is,” the minister said.
Sitharaman stressed that it was a “very substantive” discussion and the agreement that all of them had was this: “Yes, it has got to be globally handled”.
(With inputs from agencies)