On 19-20 March in Argentina Buenos Aires, a meeting of Finance Ministers and Central Bank prior to the summit of the Big twenty (G20 2018) — group, members of which are the twenty largest economies in the world. The main part of the summit of leaders scheduled for November-December.
Among the most discussed topics of the meeting of Ministers included the issue of regulation of the cryptocurrency industry. The issues raised at the summit in Argentina, could have a significant impact on the world of cryptocurrency market. The main leitmotif of the meeting of Finance Ministers was the conclusion: the market must not prohibit, but to regulate. Separately, a question was raised on how to tackle this problem, countries such as China, USA and Japan.
This article presents the main points that were discussed at the meeting. In July must be submitted the first concrete proposal for regulation. That is why it is very important to monitor the development of the theme, because eventually it will have to provide the cryptocurrency’s legitimacy, thus paving the way in the industry major investors and institutional markets.
1. The country needs to master the use of the cryptocurrency and blockchain
Representatives of the financial regulators of the G20 countries recognized that cryptocurrencies attract a growing number of people and cannot be ignored. In addition, digital currencies can (and according to the Spanish Minister of Finance and should) help governments to expand social policies.
2. States recognize the shortcomings of traditional economy
The Ministers agreed that the traditional economy is in transition process, and that to separate the digital age from the economy is no longer possible.
3. The inevitability of regulation
Regulation is an inevitable process, and despite the fact that the economy is digital, the citizens of real people, as well as the company, so their activities, as well as in other sectors of the economy, the necessary legal norms.
4. Regulate, but not ban
The meeting participants unanimously agreed that cryptocurrencies are of great importance and represent a revolution in economic and social organization, so they cannot deny, but they must go through the regulatory process.
5. Regulation will not prevent, but taxation is inevitable
At the meeting it also became clear that the regulatory process should be taken very carefully, so that strict rules did not prevent the development of the technology. However, the introduction of fees in the various fields of the technology is already almost solved.
6. The first proposals for regulation will be presented in July
Responsible for the regulatory proposal, the G20 appointed the chairmen of the Central banks of the group of development of financial measures of struggle against money-laundering (FAFT) and the Organization for economic cooperation and development (OECD). The first practical proposals will be presented in July at the third meeting of Ministers of Finance and presidents of Central banks.
7. Prevention of crimes
Proposals for regulation are primarily aimed at preventing illegal activities such as terrorism financing and money laundering, and to protect consumers, including, among other things, the removal of fraudulent transactions with ICO and other cryptocurrency projects.
8. Tracking and a rule of «Know your customer» (KYC)
Still have not reached an agreement about how and whether to track or mark scriptactive, with the aim of establishing from where they came or where they were going. When discussing these issues it is necessary to consider the standards of KYC or Digital identity (Digital Identity).
9. Europe wants to carry out the process without the G20
Europe supports the implementation of the process of regulation of cryptocurrency, however it is not going to wait for July, when will be declared the official position of G20 countries. Several countries of the European continent United in a working group to discuss this issue and the introduction of practical standards for Europe before twenty will present its proposals. Regulation of cryptocurrencies in Russia can also be taken to the July meeting.
Despite the fact that the topic of self-regulation in the formal meetings have not yet been addressed, this process has successfully promoted in Japan, Puerto Rico and the United States and is a quite promising direction.