Global Regulator Mulls Cryptocurrency Framework

An international organization that monitors the global financial system is examining how to regulate cryptocurrency.

The Switzerland-based Financial Stability Board (FSB) could devise the first global framework for cryptoassets, including bitcoin and stablecoins, a source told Reuters.

If the FSB produces a unified rule book on digital currency, it would be in stark contrast to the way crypto is handled worldwide. Today, some countries have no rules, while others have banned it.

The European Union (EU) is considering a wide-ranging set of standards for authorizing and supervising the crypto sectors.

At a recent webinar, Robert Ophele, chairman of the Autorité des Marchés Financiers (AMF), which regulates the France’s financial markets and is a member of the FSB, said regulators have been behind the curve because cryptoassets were not yet a threat to financial stability. But now they are on the top of the FSB’s agenda.

“I do think we could achieve, deliver on these issues in the next few quarters… the FSB is going full steam on this issue,” he said, according to the report. “The current structure is no longer fit for the purpose with the development of cross-border digital market activities.”

While rules adopted by the FSB have no teeth and cannot be enforced, its members recommend regulatory principles in their own national regulations.

Globally, regulators are playing catch-up as financial markets continue to digitalize. For example, social media platforms and smartphones are becoming more heavily used by investors to buy and sell shares.

Verena Ross, executive director of the European Securities and Markets Authority (ESMA), said the European Union’s securities watchdog is examining so-called “finfluencers” or social media influencers who provide stock tips without checks and balances.

“This fast moving phenomenon requires active monitoring,” she said.

This week, Russia became the latest government that is expected to unveil cryptocurrency rules.

See also: Russia Set to Propose Regulatory Plans for Crypto This Week