G20 organization preparing global crypto rules

The non-existence of global rules for the crypto segment has led to an increasing number of scams involving cryptocurrencies. To deal with this situation, the Financial Stability Board (FSB) of the G20 is preparing to propose stricter global rules for the crypto segment in the next few months.

As Reuters reports, the FSB includes officials from regulators and central banks from G20 countries. The FSB was restricted to monitoring the crypto segment but over the past few months, due to the high volatility in cryptocurrencies and the rise in scams, stricter regulations are needed. In a statement issued by the FSB, it has been said that it will report to the G20 finance ministers and central bank governors regarding regulatory control and monitoring of stablecoins and other crypto assets. The price of Bitcoin, the largest cryptocurrency by market capitalization, touched a high of nearly $69,000 in November last year. Since then, bitcoin has fallen sharply and its price has come down to around $20,400.

Regarding stablecoins, the FSB believes that using them as a means of payment requires stringent regulation related to them. The FSB does not have the power to make laws, but its members are committed to implementing its regulatory principles within their jurisdictions.

After the steep fall in the stablecoin Terra UST almost two months ago, there has been a demand for regulation of the crypto segment in many countries. In this episode, South Korea’s financial regulator Financial Supervisory Service (FSS) also decided to tighten the monitoring of virtual assets and analyze the risks associated with them. Stablecoins are cryptocurrencies that attempt to link their market price to a reserve asset such as gold or common currencies. These are more commonly used for digital transactions that involve converting virtual assets into real assets. USD Coin, Tether and Binance USD are some of the popular stablecoins, which are pegged to the US Dollar. Stablecoin, a rapidly growing version of crypto, has emerged as a major medium of exchange. It is often used by traders to remit funds.

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