The annual G20 meeting held by the 20 largest economies in the world has among this year’s pre-discuss, raised the topic of cryptocurrencies and their influence on the global financial ecosystem.
This year’s meeting to be held in Osaka, Japan on June 28 and 29; featured a pre two-day meeting in Fukuoka, Japan between finance ministers and central bank governors of these top world economies ahead of the G20 summit. Also in attendance were international organizations IMF, World Bank and invited guest countries.
At the meeting, ministers expressed the opinion that technological innovations such as digital money and blockchain, can bring significant benefits to the global economy. However, the G20 ministers also highlighted the need to analyse possible risks like money laundering and terrorism financing. The final communiqué reads:
Technological innovations, including those underlying crypto-assets can deliver significant benefits to the financial system and the broader economy. While crypto-assets do not pose a threat to global financial stability at this point, we remain vigilant to risks, including those related to consumer and investor protection, anti-money laundering (AML) and countering the financing of terrorism (CFT).
The states proposed additional measures aside the regular KYC processes which include a possible enforcement of the ‘travel rule’ among G20 exchange trading parties. The G20 considers these threats as low at this time and recognizes the potential of crypto assets.
Also present at the meeting was IMF boss – Christine Largarde , who called for a harmonized approach to crypto assets to ensure international unification on the matter. Other cypto advocates called for a balanced approach between privacy and compliance.
The choice of Japan for this year’s meeting seems more significant, considering Japan’s progressive stance with regards to cryptocurrency. Japan currently ranks as the second highest fiat to Bitcoin (Japanese Yen to Bitcoin) trading nation in the world. Also, G20 members view Japan as a suitable blueprint for this nascent industry.
Hints on the launch of a possible unified cryptocurrency exchange for G20 nations where also highlighted.
Will fiat institutions maintain their strict approach to digital assets? Will the new tech thrive under them? Share your thoughts in the comments!