FM Nirmala Sitharaman says G20 members favor global crypto regulations

Finance Minister Nirmala Sitharaman, who is in the US to attend a series of meetings, said the G20 members have agreed that there should be a globally coordinated understanding to regulate crypto-assets and also to deal with the challenges associated with it. She said that crypto-assets are not backed by central banks and can fall and cause macroeconomic instability.

On Thursday, Sitharaman said after meeting G20 member ministers that all members have responded to the issue with sharpness and under India’s presidency of G20. A “synthesis paper” will be taken up on issues related to crypto-assets, the minister said at a press conference in Washington on Thursday.

“I am happy to say that there is a greater acceptance among all G20 members, that any action on cryptoassets must be global,” Sitharaman, adding that “the G20, I think, has reacted fairly with sharpness (to the crypto). challenge),” she said.

India has always maintained that it wants a collective global effort to deal with problems caused by cryptocurrencies, such as bitcoin, ether. The Finance Ministry said in February that it had held a seminar for G20 member states to discuss how to come up with a common framework.

On the sidelines of the annual spring meeting of the International Monetary Fund (IMF) and the World Bank, Sitharaman along with Reserve Bank of India Governor Shantikanta Das chaired a meeting of finance ministers and central bank governors from member countries.

Sitharaman said: “The way we see this outcome under our presidency is that the IMF’s paper will be discussed, the FSB’s paper will also be taken up, and a synthesis paper will be prepared from the IMF paper and the FSB paper together.”

There will be a discussion in September and October, and at the end of the day we will see a roadmap being prepared for how and what kind of understanding the members of the G20 have in this, and it can be taken forward on specific regulatory actions as and when the G20 takes a call to that, said the finance minister.

She added that the work done by the FSB and the IMF indicates that crypto-assets, especially those outside of central banks, which are not backed by any sovereign assets, can cause macroeconomic instability.

“So, today we are in a position to see how countries now recognize that it is not only a regulatory issue for cryptoassets, where the countries have to come together, but the IMF dealing with it has also this time mentioned that they can be issues of macroeconomic stability , she said.

“Today I am very pleased to have heard European Central Bank Governor Christine Lagarde talk about specific examples of how money has been routed into this operation, which has resulted in too many such companies engaging in it raising questions about where the track is. “, the minister said on Thursday.

Cryptocurrencies as a means of payment in India are not regulated by any central authority, such as the RBI. There are no rules and regulations or any guidelines laid down to resolve disputes while dealing with cryptocurrency.

The Center has, through a notification dated March 7, 2023, brought digital assets and fiat currencies, virtual digital assets (cryptocurrencies) and such other digital assets, their trading, custody and related financial services under the ambit of the Prevention of Money Laundering Act (PMLA ).

(With PTI inputs)

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