International finance body plans to set rules for stable coins Photo Credit: Reuters
In light of the crypto sector’s ongoing crisis, the Financial Stability Board or FSB, an organization that advises on matters related to international finance, has promised to report on the regulation of cryptocurrency-related activities soon.
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Citing the “recent turmoil” in the crypto market, the FSB statement underscored the need for common domestic and international standards to regulate crypto assets, including stablecoins.
“Stable coins must be captured under strong regulations and supervision of relevant authorities if they are to be adopted as a widely used means of payment or otherwise disrupt the financial system,” said the FSB report published on Monday. should play an important role.”
Stablecoins are cryptocurrency tokens that are linked or “pegged” to the value of assets such as the dollar, pound, euro, or even gold and oil. These assets are popular in economies where the official currency is rapidly losing value.
However, in May this year TeraUSD [UST] Stablecoins – where each UST should be worth 1 USD – collapsed, billion dollar explosion off the market
The following month, bitcoin and ether prices also plummeted, putting major crypto companies and lending platforms in jeopardy. freezing of user funds And mass layoffs obeyed.
“FSB is working to ensure that crypto-assets are subject to strong regulation and supervision. FSB to report on regulatory and supervisory approach to stablecoins and other crypto-assets to G20 finance ministers and central bank governors in October Will do,” the report said.
The Switzerland-based organization highlighted the need for regulatory standards to combat money-laundering, terrorist-financing, and enforce travel rules for cryptocurrencies moving across borders.
The G20 major economies – including India – and the European Commission are all members of the Financial Stability Board.