G20 Urges Countries to Adopt Global Regulatory Framework to Guide Cryptocurrencies

The Group of Twenty (G20) during its first meeting of the year urges its member countries to adopt the Financial Action Task Force’s (FATF) regulatory framework for cryptocurrencies. This global regulatory framework will guide the use of cryptocurrencies and related providers in these countries.

G20 Holds its First Meeting of the Year, Urges Member Countries to Adopt Regulatory Framework for Cryptocurrencies

G20, an international forum of Finance Ministers and Central Bank Governors held its first meeting of the year. The meeting took place in Saudi Arabia between February 22 – 23, 2020. And a publication made after the meeting reveals that the international forum wants its member countries to adopt the FATF’s regulatory standards guiding cryptocurrencies and crypto-related businesses.

G20, on the same stance as October 2019, risks associated with global stable coins should be evaluated and addressed appropriately. When these risks have been addressed, cryptocurrency projects can commence operations.

G20 Says Technological Innovations Bring Immense Benefits

Furthermore, G20 noted that technological innovations can bring immense benefits to the financial system and the economy as a whole. As such, the forum supports setting up a supervisory and regulatory framework for the digital era.

Nonetheless, G20 revealed that it is still at alert to the potential risks stemming from financial innovations. Some of these risks include consumer and investor protection, anti-money laundering (AML) and countering the financing of terrorism (CFT), and financial stability.

G20 Acknowledges the Need to Improve Cross-border Payments

G20 also acknowledged the need to improve global cross-border payments in order to facilitate faster and low-cost transfers. It, therefore, called on the Financial Stability Board (FSB) to collaborate with relevant bodies to develop a roadmap. And this road map would potentially help to enhance cross border payments by October 2020.

On the other hand, cryptocurrencies like XRP have been facilitating speedy cross border payments. BTCNN, for instance, reported on February 27, 2020, that Ripple, the blockchain company behind XRP used its network to transfer $24 million from the U.S. to Mexico within a week. Also, Azimo, a money transfer service in Europe noted that it facilitated fast and cheap transfers using XRP-based product.

That aside, strict regulation has been one of the major barriers to companies venturing into the crypto space. In 2019, the FATF outlined that cryptocurrency exchanges need to share customer information with each other. BTCNN also informed on February 24, 2020, that Europe’s New AML Directive will ensure that European banks can no longer turn crypto companies away as long as they meet the FATF’s requirements.

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