At the upcoming G7 meeting in Hiroshima this May, Japan, The United States, The United Kingdom, Canada, France, Germany, and the European Union are expected to unite to create a cooperative strategy for tougher global cryptocurrency regulations, according to Kyoto news agency reports.
Furthermore, the initiative will aim to increase transparency and consumer protections surrounding digital assets while addressing risks that could be posed to the international financial system. Japan has already implemented regulatory guidelines for cryptocurrencies, and soon the EU’s Markets in Crypto-Assets (MiCA) regulation will come into effect. Additionally, the UK has taken steps towards a crypto framework by introducing a special category for crypto assets on tax forms and plans to introduce a digital pound.
The Canadian government considers digital assets as securities, and the United States is using existing financial regulations. Some anticipate that lawmakers may introduce a crypto regulatory framework in the near future. To further this goal, the Financial Stability Board (FSB), International Monetary Fund (IMF), and Bank for International Settlements (BIS)— a group of the world’s 20 biggest economies constituting the G20— have made concerted efforts towards standards for digital assets. This was reiterated in February during a meeting in Bengaluru, India.
Furthermore, the IMF is expected to deliver its recommendations on the regulation, supervision, and oversight of global stablecoins, crypto assets activities, and markets by July and September. It remains uncertain what attitude these guidelines will take given that in February this year, the fund released an action plan calling for countries to revoke cryptocurrencies’ legal tender status. This opposition to crypto as a legal tender is well documented, especially since El Salvador declared Bitcoin its official currency in September 2021. Despite this, the IMF advocates for more stringent crypto regulation and is currently developing an interoperable central bank digital currency platform to connect multiple global CBDCs and facilitate cross-border transfers.