G20 Leaders’ Summit to Discuss Coordinated Action on Crypto Assets
Introduction
The G20 Leaders’ summit this weekend will discuss a template and various building blocks for coordinated action on dealing with crypto assets, potentially paving the way for a global regulatory framework.
Synthesis Paper by IMF and FSB
A synthesis paper prepared by the International Monetary Fund (IMF) and Financial Stability Board (FSB) at the behest of the G20 Finance Ministers and Central Bank Governors on overall crypto asset regulation will be taken up by the leaders. “The synthesis paper will lay down a comprehensive roadmap and building blocks for a coordinated global regulatory framework… Leaders will take a final call on this,” said a senior government source.
India’s Push for Global Regulatory Framework
India has been pushing for a global regulatory framework on crypto assets under its G20 presidency as it strongly believes they cannot be regulated in isolation by any single country.
Prime Minister’s Pitch
Prime Minister Narendra Modi had at the recent B20 summit made a strong pitch for a global regulatory framework for crypto assets that would address the concerns of all stakeholders.
Recommendations by FSB
At the G20 Finance Ministers and Central Bank Governors meeting in July, the FSB had given recommendations for the regulation, supervision, and oversight of crypto asset activities, markets, and global stablecoin arrangements.
IMF Paper on Challenges
The IMF paper deals with the challenges posed by these digital assets to monetary policy and capital flow management. India has also submitted a note from its presidency on crypto assets.
Government’s Efforts
New Delhi has long sought to bring discussions on the need for a global framework to the forefront under its presidency, said the person cited above. In the budget for FY23, the government imposed a 30% tax on gains made from virtual digital assets while clarifying that this didn’t confer legal validity on cryptocurrencies.
Central Bank’s Stance
The Reserve Bank of India (RBI) favors a complete ban on crypto products.
