International watchdog set to roll out new global framework for crypto assets: report

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The Financial Stability Board, the world’s largest financial services regulator, plans to roll out a global regulatory system for cryptocurrencies in early 2023.

According to a new report from the Financial Times, the FSB will announce in the coming months a timetable for the implementation of international crypto rules that local governments would then impose.

According to the report, Dietrich Domanski, the outgoing FSB Secretary General, says the intention is to hold crypto service providers to the same standards as banks… if they provide the same service as banks.

The FSB is considering rules for crypto-related companies that offer a combination of traditionally segregated financial services: governance of financial transactions as well as transparency and protection of customer funds.

The FSB push to regulate crypto is spurred by the November implosion of crypto exchange FTX and the May collapse of Terraform Labs Terra USD stablecoin, according to the Financial Times.

Says Domanski,

“Many players in the crypto market claim that the authorities are hostile to innovation. I would say that so far the authorities have been quite accommodating…recent events have reinforced the recognition that there is indeed an urgency to address the risks.

According to the report, Domanski says international crypto rules could have prevented an FTX implosion, but defended the group for waiting until now to act, saying he needed time to understand the technology and see how it worked. would evolve.

Says Domansky,

Anyone who says, you should go faster, you should do more, I would invite them to go through a global cooperative process…and then tell me where there are points where we could have gone faster.

Many groups have long called for global crypto regulation, including UNICEF. The United Nations fund dedicated to helping underprivileged children has previously said that crypto could improve remittances and make social assistance programs more efficient, but that it goes unregulated poses serious threats.

According to the report, the FSB plan aims to bring a uniform approach to crypto and show regulatory progress.

Says Domansky,

One of the goals of this work plan is precisely to counter a perception that all of this (cryptocurrency work) is scattered and slow and not focused on a single common goal.

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