FSB to submit crypto and stablecoin regulation recommendations in October

The Financial Stability Board (FSB), an international body that oversees and proposes rules for the global financial system, issued recommendations for regulating stablecoin and cryptocurrencies in October, according to a statement on July 11. To do.

The Swiss-based organization reports to the G20 Finance Ministers and Central Bank Governor.

among them reportThe FSB said the recent plunge in the crypto market has highlighted the volatility and vulnerability of cryptocurrencies and their increased interoperability with traditional financial systems. He added that crypto assets can have a “spillover effect” on traditional finance such as the short-term funding market.

This report is a repeat of the concerns that the FSB highlighted in February. Said The cryptocurrency poses a “threat to global financial stability.”

The current report states:

“An effective regulatory framework considers the new capabilities of crypto assets and leverages the potential benefits of the technology behind them, while providing the same risk as traditional financial activities with crypto asset activities with the same regulatory results. Must be guaranteed to be subject to. “

The report added that cryptocurrencies and stablecoins must comply with existing regulations that address the risks of crypto assets.

Digital assets can perform the same economic functions that traditional financial instruments and intermediaries in the financial sector perform. Therefore, these assets must comply with the relevant regulations that apply to the “basic economic and financial nature of crypto assets”, in line with the principles of “same activity, same risk, same regulation”.

addition:

“FSB members are committed to using enforcement powers within the legal framework within their jurisdiction to promote compliance and act against violations.”

The report also stated that high regulatory and transparency standards must be followed in order for Stablecoin to be widely adopted as a payment instrument or for Stablecoin to play an important role in the financial system. rice field. He added that unregulated stablecoin could pose a significant risk to financial stability.