G-7 Commits to Boosting Developing Nations’ Crypto Prosperity

Key Points:

• The G-7 will prioritize helping developing nations introduce CBDCs, with a focus on increasing transparency and governance.
• Discussions regarding crypto regulation are expected to accelerate ahead of a meeting of finance ministers and central bankers from the G-7 countries in mid-May, with plans to make global crypto regulations tougher.
• The Financial Stability Board (FSB) and the International Monetary Fund are producing a synthesis paper for global crypto rules by September or October.

During a seminar held in Washington DC on Tuesday, Masato Kanda, Japan’s senior financial diplomat, announced that the Group of Seven (G-7) advanced nations would prioritize helping developing countries introduce their central bank digital currencies (CBDCs).

Kanda emphasized the benefits of fast-moving digital technologies, such as cheaper and faster cross-border payments, which can be made available to a larger public. However, these new technologies come with onset challenges, and Kanda stressed the importance of addressing risks from the development of CBDCs by ensuring appropriate transparency and sound governance.

Japanese Prime Minister Fumio Kishida will host this year’s G-7 summit in Hiroshima. Discussions regarding crypto regulation are expected to accelerate ahead of a meeting of finance ministers and central bankers from the G-7 countries in mid-May. The G-7 is planning to make global crypto regulations more challenging, with a focus on increasing business transparency and consumer protection.

Kanda also highlighted the significance of regulating crypto assets consistently across borders. He cited the collapse of FTX as a serious wake-up call, stressing the need for proper consistent regulation across borders. He emphasized the importance of finalizing FSB’s (Financial Stability Board) work to develop high-level recommendations on crypto asset activities on the market and on global stablecoin arrangements. The effective implementation of these recommendations is crucial.

FTX Japan customers were some of the first to get their money back from the collapsed crypto exchange, thanks to Japan’s relatively tight regulatory regime for crypto. The Group of 20 major economies has tasked the Financial Stability Board (FSB) and the International Monetary Fund to put forward a jointly produced synthesis paper for global crypto rules by September or October.

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