October 22, 2020

G20 asked IMF to examine risks associated with stablecoins

G20 states stablecoins threaten global monetary system and financial stability, and asked the IMF to assess the risks associated with them, reports Reuters.

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G20 countries formulate policiesstablecoins based on the recommendations of the Financial Stability Board (SPS) and the Anti-Money Laundering Measures Development Group (FATF), which will provide relevant conclusions in 2020.

“Unless the risks associated with stablecoins are eliminated, they cannot be issued”- summed up the head of the Japanese central bank Haruhiko Kuroda.

G20 asked IMF to examine risks associated with stablecoins

Alastair Pike / AFP / Getty Images Photo

He stressed that emerging economies are already concerned about the potential of stablecoins with a huge user base, but not only they should be afraid.

German Finance Minister Olaf Scholz at the G20 meeting reiterated that the launch of Libra from Facebook must be stopped. He is confident that issuing money is the prerogative of states, not private companies.

The G20 recognized the strengths of the technology, but insisted that they were not going to ignore the threat of money laundering and consumer protection issues.

Representatives of the G20 did not discuss the creation of digital currencies of central banks, which China is currently actively preparing.

Chinese digital currency - totalitarianism or a new monetary theory?

Recall that G7 believes that bitcoin and otherscryptocurrencies have not become a “reliable and attractive” means of payment and savings. The group recognized the benefits of stablecoins, but urged not to launch such projects until legal issues are resolved.

The same position was expressed in the FATF, which previously published a guide for cryptocurrency service providers.

A game of cat and mouse with regulators, or what the new FATF recommendations mean for the bitcoin industry