A group of global banking experts organized by the World Economic Forum (WEF) met on the need for global crypto regulation, including stablecoins and unbacked crypto assets. The panel agreed that there should be at least some form of base regulation for these assets and equivalent banking regulation for blockchain applications seeking to offer products similar to those offered by traditional banking.
WEF Global Banking Panel Seeks More Crypto Regulation
Global bankers have agreed on the need for clearer regulations for cryptocurrencies. in a panel Titled “Banking in the Eye of the Storm,” part of the World Economic Forum (WEF) Davos 2023 meetings, the leadership of central and private banks examined the cryptocurrency market after events that unfolded during 2022, including the fall of the cryptocurrency exchange. FTX.
François Villeroy de Galhau, Governor of the Central Bank of France, explained that regulation of crypto markets was key to controlling the possible harm that they could bring to investors in the future. Villeroy de Galhau stated:
The question is not whether we have to regulate or not… surely we have to regulate. Some even say that it is not a matter of regulating, it is a matter of prohibiting.
Villeroy de Galhau also promoted the alliance of central banks and private banking institutions to promote innovation, including the adoption of CBDCs (Central Bank Digital Currencies).
The governor of the Central Bank of France also awaits the implementation of the Basel Committee’s finalized rules in all jurisdictions, which were approved in December and offer guidelines for banks’ exposure to cryptocurrency assets.
A basic level of regulation
While all panelists agreed on the need for at least a minimum level of regulation, including anti-money laundering (AML) and know-your-customer (KYC) measures for all assets, Tharman Shanmugaratnam, Chief Minister of Singapore , stated that some assets would be better left unregulated, clarifying the risks that investing in these assets could bring to potential investors.
However, he clarified that any cryptocurrency and blockchain-based technology that aims to offer comparable services to banks, including stablecoins, should be regulated in the same way as traditional financial institutions.
Shanmugaratnam believes that banks’ response to cryptocurrency and blockchain innovation should be to link local home systems with today’s global payment systems, to help immigrants and SMEswhich are currently served by cryptocurrency alternatives.
What do you think about the opinion that bankers have about the regulation of cryptocurrencies? Tell us in the comment section below.
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