The G7 officials discussed the need to regulate crypto assets and prevent its use for any malicious or illicit activities. There’s strong support across the top economies to regulate digital assets.
On Monday, December 7, G7 officials met for discussions on the latest economic outlook and the road ahead. The G7 Finance Ministers stressed the need to regulate crypto as per the statement from the US Treasury Secretary Steven Mnuchin.
— Steven Mnuchin (@stevenmnuchin1) December 7, 2020
The financial officials discussed some upcoming measures in response to the COVID-19 economic crisis. The statement from Mnuchin notes that the officials talked about the responses on the ever-changing landscape of cryptocurrencies. The public statement issued by the US Treasury Department states:
“They also discussed ongoing responses to the evolving landscape of crypto assets and other digital assets and national authorities’ work to prevent their use for malign purposes and illicit activities. There is strong support across the G7 on the need to regulate digital currencies. Ministers and Governors reiterated support for the G7 joint statement on digital payments issued in October.”
Regulators are stepping up their engagement on crypto regulations in recent months. Moreover, central banking institutions and even commercial banks have shown interest in digital currencies. In the latest G7 meeting hosted by Secretary Mnuchin, the IMF, the Financial Stability Board, and World Bank leaders also participated.
Rumors are that Mnuchin will pass a crypto ruling for digital wallets in the coming weeks. The rumor will likely ban users from using third-party wallets except the ones offered by regulated crypto exchanges.
On Monday, Standard Chartered CEO Bill Winters also mentioned that the widespread use of cryptocurrencies is absolutely inevitable. Besides, he also noted that the public-private partnership is essential for the growth of the digital currency market. Dropping a hint, he also noted that Standard Chartered might announce its own digital currency in the coming days.
Germany’s Finance Minister Bashes Facebook’s Libra
Soon after the G7-meeting concluded, German Finance Minister Olaf Scholz took the moment to bash Facebook‘s Libra crypto project. Facebook’s Libra, recently renamed to the Diem stablecoin fails to impress the German regulators. As reported by Reuters, Scholz referred to Facebook’s Diem as “A wolf in sheep’s clothing”. He added:
“It is clear to me that Germany and Europe cannot and will not accept its entry into the market while the regulatory risks are not adequately addressed. We must do everything possible to make sure the currency monopoly remains in the hands of states.”
Facebook’s had to scale down its ambitions with Libra after major regulatory backlash over the last year. But it seems that the project is still not out of trouble.
On the other hand, Scholz has been much positive and eager for the development of the Digital Euro. A few weeks back, he stated that the European Central Bank (ECB) should accelerate the development of the Digital Euro.
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.