The Financial Stability Board (FSB) has published a global regulatory framework for crypto asset activities. This framework is a response to the intrinsic volatility and structural vulnerabilities of crypto-assets and aims to address risks and strengthen cross-border cooperation.
Facts
- The FSB, an international body monitoring the global financial sector, has released a regulatory framework for crypto assets.
- This news follows the FSB’s previous statement from a year ago, calling for international regulation of the crypto industry.
- The framework consists of two sets of recommendations: one for regulating crypto asset activities and markets, and the other for “global stablecoin” arrangements.
- The FSB has emphasized three areas with strengthened recommendations: safeguarding client assets, addressing conflicts of interest, and improving cross-border cooperation.
- The framework does not cover all specific risk categories related to crypto assets, and Central Bank Digital Currencies (CBDCs) are exempt from these recommendations.
- Alisa DiCaprio, chief economist at R3, sees the announcement as a positive step for the industry, promoting transparency and capital requirement measures.
- The global framework includes a work plan for 2023 and beyond, developed with standard-setting bodies (SSBs), and aims to promote consistent global regulation with ongoing monitoring and possible further guidance if needed.
