Financial Stability Board Lays Out G20 Crypto and Stablecoin Plans
The Financial Stability Board (FSB), an international advisory body created by the G20, has laid out its recommendations for crypto regulation, and said most existing stablecoins are not in compliance.
FSB’s recommendations for crypto and stablecoin regulation were first endorsed by the G20 – a group consisting of the world’s 20 largest economies – two years ago, with updated recommendations published on Tuesday this week along with a request for public feedback.
Perhaps most importantly, the recommendations clearly showed that the FSB is concerned about custodial wallet providers and exchanges, and to what extent they should be held liable for things like the loss of private keys.
The loss of keys by a wallet provider supporting a stablecoin could ultimately bring the safety of the specific stablecoin into question, the document containing the recommendations explained. For instance, actions taken by the crypto exchange Binance could have an impact on how users view the stablecoin Binance USD (BUSD), while Bitfinex and Tether (USDT) are also seen as having close ties to each other.
The recommendations from the FSB comes after the organization in July urged governments to step up their supervision of stablecoins, citing recent turmoil in the crypto sector as a risk factor.
Among the key recommendations laid out in the updated 77-page report this time were:
Summarizing its recommendations, the FSB said it aims to “promote consistent and effective regulation, supervision and oversight” of what it calls global stablecoins (GSCs). It noted that this should happen across jurisdictions, while still “supporting responsible innovation and providing sufficient flexibility for jurisdictions to implement domestic approaches.”
The document
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