IMF Asks For The Leading Effort To Regulate Crypto

Two new reports by the International Monetary Fund (IMF) on regulating stablecoins and unbacked cryptoassets have called on the Financial Stability Board (FSB) to set and lead global efforts on crypto regulation.

According to the reports, which were released on Monday, the watchdog is “well placed to take the lead in coordinating and establishing global standards to support national regulation of crypto assets,” as well as directing the national implementation of regulation of crypto assets while taking into account sector-specific standards.

The creation of universal categories to inform cross-sectoral standards and direct data collecting is one of the measures outlined in the reports. Additionally, they promote a risk-based approach with extra requirements for “entities and activities that generate higher risk” and suggest that stablecoins be backed by secure and liquid assets.

The FSB will report to G20 finance ministers and central bank officials in October on “high-level recommendations” regarding crypto and particularly stablecoins, according to a statement issued by the FSB from this summer.

IMF has worked with FSB to create regulatory frameworks for crypto

In a blog post from December 2021, the IMF also emphasized how closely it has worked with the FSB in the past to create regulatory frameworks for cryptoassets. The papers draw on the Basel-based organization’s preexisting research, concepts, and definitions as a foundation for its recommendations, demonstrating the effectiveness of the collaboration.

As a replacement for the Financial Stability Forum, the FSB was established during the financial crisis of 2008.

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