Closing Statements At G20 Declare Cryptocurrencies As Assets, Not Securities


In February this year, Mnuchin said that he would raise the idea of cryptocurrency regulation at the G20 summit mainly to combat its use for money laundering and other illegal businesses, but he strongly believes that cryptocurrencies are not a risk to the financial market stability, at least at this point.

France, which along with Germany put cryptocurrencies on the G20's agenda, has proposed taking specific steps, such as banning deposits and loans in such currencies and the marketing of investments based on them to the general public.

Cryptocurrencies were set to be a hot topic among the Summit, as many different countries have scrambled in the last 9 months to attempt to regulate the digital assets.

"The first assessment of the FSB is that now, these crypto-assets do not pose a risk to global financial stability", said Mark Carney, the President of the FSB, in a letter he sent to the finance ministers and governors of central banks, which will meet in Buenos Aires on March 20th and March 21st. The FSB has developed the global reforms necessary to fix the fault lines that caused the financial crisis through a collaborative, consensus-based approach that relies on the expertise of its members in order to deliver efficient and decisive analysis and action. The price of Bitcoin jumped above $9,000 after the positive statement from G-20.

Ethereum increased from approximately $10 per Ether to $755 during the same time period.

Richard De Sousa, partner at AltcoinTrader, a South African-based crypto-currency exchange, says: "The G20 countries represent over 85% of global economic output and 75% of worldwide trade".

"We dedicated a lot of time to crypto currencies", Argentine central bank President Federico Sturzenegger told reporters after the meeting.

Meanwhile, a global pursuit to better understand and regulate the crypto-currency market is under way.

In SA, the central bank recently established a Financial Technology Programme to review its position on private crypto-currencies.

The chairman of the Financial Stability Board (FSB) has advised G20 members that cryptocurrencies do not now present a threat to the stability of the global economy and that cryptocurrency regulations should not be a priority at this year's summit.

Blockchain company Vanbex notes the discourse and regulatory angling taking place is certainly cause for quiet excitement.

This pushes back the prospect of a global rule book on the matter, something that some regulators say is needed to tackle a phenomenon that transcends borders.