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Saudi’s SAMA chief raises concerns over cryptocurrencies at G20 meeting

Saudi's SAMA chief raises concerns over cryptocurrencies at G20 meeting

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TL;DR

  • SAMA Governor Ayman Alsayari highlighted the urgent need for robust supervision and regulation of cryptocurrency activities, supporting the roadmap set by the IMF and the Financial Stability Board.
  • Amidst global economic slowdown with expected growth at around three percent for the upcoming year, Saudi Arabia stands out with strong non-oil sector growth, thanks to its structural reforms.

Marrakech, Morocco – Amidst a global backdrop of economic slowdown and rising inflation rates, Ayman Alsayari, the Governor of the Saudi Central Bank (SAMA), voiced his concerns about the potential threats posed by cryptocurrencies and their brokers to the world’s financial stability. These statements were made during the G20 Finance Ministers and Central Bank Governors (FMCBG) meeting that recently concluded in Marrakech, Morocco.

Cryptocurrencies: A potential threat to financial stability

Cryptocurrencies have increasingly become a topic of interest and concern in global economic forums, especially given their rapid adoption rate across various sectors and the equally quick proliferation of brokers and platforms offering these assets. Alsayari’s comments on the need for robust supervision, regulation, and coordination of cryptocurrency activities echo sentiments shared by other world leaders and financial stakeholders.

“We need good supervision, regulation, and coordination of cryptocurrency activities. In this context, we support the work and relevant roadmap of the IMF and the Financial Stability Board to address risks related to cryptocurrencies,” Alsayari emphasized during his address.

The discussions and concerns around cryptocurrencies aren’t new. With their decentralized nature, lack of tangible backing, and wild price fluctuations, they have often been a cause of worry among traditional financial institutions and regulators worldwide.

The global economic landscape: A slowing growth

Alsayari painted a somber picture of the global economy during his address, highlighting a significant slowdown compared to the growth rates of previous decades. With the world grappling with high inflation rates, many countries have resorted to implementing tight monetary policies in hopes of curbing these rising numbers.

“As a result, the global growth rate is expected to be around three percent this year and next,” Alsayari stated. Such projections can have serious implications for businesses, investors, and everyday citizens, who may face higher costs of living and potentially lower returns on investments.

However, on a positive note, Alsayari showcased Saudi Arabia as an example of resilience and adaptability. Thanks to structural reforms, the nation’s non-oil sector has witnessed commendable growth. This growth is accompanied by stable inflation rates, even as many emerging markets and developing economies grapple with the challenges presented by the current global conditions.

G20’s action-oriented roadmap on cryptocurrencies and MDB reforms

The G20 meeting in Marrakech was not just a platform for expressing concerns but also an avenue for action. The G20 Roadmap, unveiled at the conclusion of the FMCBG meetings, presents a detailed strategy to coordinate global policies concerning crypto assets. More than just a general framework, this roadmap offers specific strategies and regulations tailored to crypto assets, ensuring that the unique challenges and implications faced by Emerging Markets and Developing Economies (EMDEs) are duly considered.

This roadmap, combined with the collective will of the world’s leading economies, aims to create a safer, more regulated environment for the use and trading of cryptocurrencies, ensuring that potential risks are mitigated while fostering innovation and growth.

Conclusion 

As the world finds itself at an economic crossroads, forums like the G20 meeting in Marrakech serve as vital platforms for collaboration and strategy formulation. With leaders like Alsayari highlighting pressing issues and voicing their concerns, there is hope for a balanced approach that embraces the potential of new technologies like cryptocurrencies while safeguarding the global financial system from potential pitfalls

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

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Haseeb Shaheen

As a Web Researcher and Internet Marketer, Haseeb Shaheen delivers relevant valuable content for audiences. He focuses on financial and crypto market analysis, as well as technology-related areas that help people change their lives.

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