Crypto regulation in the world: weekly digest #11

IMF

The International Monetary Fund (IMF) is calling for the introduction of global standards for cryptocurrency regulation in order to ensure the security of further crypto adoption in the world.

This week, the IMF published a report on the regulation of cryptocurrencies in the world. The report, prepared by the IMF’s Monetary and Capital Markets Department, provides a brief analysis of the differences in approaches to the regulation of cryptocurrencies in various countries.

The authors did not start with the risks associated with cryptocurrencies as usually international organizations do, but pointed to the fact that digital assets have already become widely available. For this reason the crypto industry necessitates comprehensive and thorough regulation.

The authors emphasize that even the term "crypto asset" is interpreted differently in different countries. The term «crypto asset» can refer to a wide range of digital products that are based on the same technology (blockchain) but can be issued, stored or traded on various exchanges, wallets and according to different principles.

The IMF is calling for a single global solution that would suit all national regulators and market participants and that would be:

• coordinated, so it can fill the regulatory gaps that arise from inherently cross-sector and cross-border issuance and ensure a level playing field;
• consistent, so it aligns with mainstream regulatory approaches across the activity and risk spectrum; and
• comprehensive, so it covers all actors and all aspects of the crypto ecosystem.

The authors of the report emphasize that recent turmoil in the crypto market and bankruptcies of crypto companies confirm this conclusion.

A global regulatory framework will bring order to the markets, will make it more secure for consumers of crypto services and establish a clear legal framework to stimulate further development of the industry.

Earlier we wrote that the UNTCAD and the Financial Stability Board also were calling for the development of an unified approach to crypto regulation in the world. Perhaps, the time has come for a new UN Convention to lay the groundwork for a global regulatory framework for digital assets.

USA

In the US, as in the rest of the world, there is still no clear definition of what cryptocurrencies are and who should regulate them. We wrote earlier that a new bill proposal on the regulation of crypto assets was introduced in the United States, which involves the regulation of operations with cryptocurrencies by the Commodity Futures Trading Commission (CFTC).

This week, U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler stated that cryptocurrencies should still be considered securities, although the agency is ready to share regulation with the CFTC. Gary Gensler once again urged crypto companies to register with the SEC, whether they are a digital asset trading platform, crypto exchanges, or crypto lending services .

SEC wants to separate the consideration of applications from cryptocurrency companies into a special department. The regulator plans to create an accounting and legal department for consultations and paperwork. The SEC is often criticized for not providing transparent rules for crypto companies/ This time it seems that the story becomes even more confusing.

News from other countries:

• The Australian Federal Police is creating a separate unit whose task will be to solve crimes related to cryptocurrency-based money laundering.
• The Reserve Bank of India (RBI) is gearing up to test the state digital currency (CBDC) with the participation of the nation’s largest banks and fintech companies.
• The UK Treasury has updated its sanctions guidance to include cryptocurrency exchanges. Crypto exchanges same as other financial institutions must report the facts of a possible sanctions circumvention and freeze funds.

We continue to highlight the news of the world of crypto regulation worldwide. Stay tuned for the latest news!