G20 FM Meeting Discussed Global Regulatory Framework For Cryptocurrencies: Nirmala Sitharaman

“The issue of cryptocurrency was also discussed to make a comprehensive, cohesive and coordinated global policy and regulatory framework for them,” Finance Minister Nirmala Sitharaman said.

A press brief issued after the meeting said that the G20 finances ministers focused on considering the macrofinancial implications of crypto assets, particularly the concerns of the Global South. ( Image Source :Getty )

Cryptocurrencies and digital assets were a significant point of discussion during the Finance Ministers and Central Bank Governors (FMCBG) meeting in Gandhinagar, said Finance Minister Nirmala Sitharaman on Tuesday. Speaking after the meeting, Sitharaman said that cryptocurrency was discussed during the meeting to make a comprehensive, cohesive, and coordinated global policy and regulatory framework. 

“The issue of cryptocurrency was also discussed to make a comprehensive, cohesive and coordinated global policy and regulatory framework for them,” Sitharaman told reporters after the conclusion of the two-day meeting.

At the meeting, G20 Finance Ministers and Central Bank Governors pledged to prioritize the well-being of people and the planet and reaffirmed their commitment to enhancing international economic cooperation, strengthening global development for all and steering the global economy towards strong, sustainable, balanced and inclusive growth (SSBIG), she further said.

The RBI Governor Shaktikanta Das, who jointly chaired the meeting with FM Nirmala Sitharaman said that the failure of large crypto exchanges in the last one year means the enthusiasm over crypto has completely gone.

"The developments over the last one year, the failure of large crypto exchanges mean the enthusiasm over crypto has completely gone." he said. However, he added, "It was recognised that CBDCs have the potential to ease cross border transactions. So it's a work in progress." 

A press brief issued after the meeting said that the G20 finances ministers focused on considering the macrofinancial implications of crypto assets, particularly the concerns of the Global South. The IMF and the Financial Stability Board (FSB) have presented reports on these implications, with specific sections addressing the concerns of emerging markets and developing economies (EMDEs).

To further enhance policy work, a Round Table discussion called "Policy Dialogues on Crypto Assets" was held during the meeting. This session involved active participation from G20 Finance Ministers, Governors, and the Heads of IMF, FSB, and FATF, institutions instrumental in ongoing work on the crypto asset ecosystem.

The insights generated in this discussion will contribute to a comprehensive Roadmap on crypto assets to be included in the IMF-FSB Synthesis Paper, which will be presented before the Leaders' Summit in September 2023, the statement said. Adding that the aim is to create a coordinated and robust policy and regulatory framework considering all risks, including those specific to EMDEs, and addressing money laundering and terrorism financing risks as per FATF standards.

Finance Minister Nirmala Sitharaman also said India brought onto the table the issue of digital public infrastructure (DPI).

“The Indian presidency has brought the digital public infrastructure (DPI) agenda into the G20 discussions. Members endorsed the transformative role of DPI in rapidly advancing financial inclusion and productivity gains,” she said.

The finance minister also stated that G20 members engaged in active deliberations on global debt vulnerabilities. They focused on enhancing multilateral coordination to effectively tackle the worsening debt situation and provide coordinated debt treatment for countries facing debt distress. When asked about Beijing's response to the development of a common debt resolution mechanism,  Sitharaman said that China's stance was positive and encouraging.

Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Cryptocurrency is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Cryptocurrency market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.