A global crypto regulation agency expected to be established next year

Ashley Alder, head of the International Organization of Securities Commissions (IOSCO), has suggested that a worldwide crypto regulation agency might be introduced by next year.

A global crypto regulation agency expected to be established next year

Alder indicated Thursday at an online conference hosted by the Official Monetary and Financial Institutions Forum that virtual currencies such as Bitcoin were among three major topics on which world authorities were currently concentrating, alongside Covid-19 and global warming.

This week, the finance industry has been focused on crypto as markets plummeted, compounded by the implosion of the stablecoin TerraUSD (UST). Bitcoin (BTC) was priced at a 16-month low earlier today.

He identified internet security, operational resilience, and a lack of accountability in the crypto sector as important issues that authorities are failing to address. This week’s focus on cryptocurrency markets has increased due to more unpredictable instability that has always frightened regulators.

“If you look at the risks we need to address, they are multiple and there is a wall of worry about this [crypto] in the conversations at an institutional level.”

-Alder

Alder believes that a worldwide crypto regulation committee is plainly required. Despite the prominence of cryptocurrency in the global debate, Alder believes that global environmental finance initiatives are well ahead of crypto legislation.

Following the demise of so-called stablecoin TerraUSD, the head of the Senate Banking Committee urged US legislators on Wednesday to tighten crypto laws, while bitcoin has also dropped about 20% this week.

Alder said a worldwide organization to try to harmonise cryptocurrency laws was certainly needed, comparing it to different climate finance setups already in existence, notably one under the G20 team of elite nations.

The collapse of Terra has sent shockwaves across the market, with leading cryptocurrency Bitcoin also losing 27 percent since the beginning of the week. At a congressional hearing on May 10, US Treasury Secretary Janet Yellen mentioned UST’s decline in the light of stablecoin regulation. When the dust settles, authorities are likely to point to UST’s failure to justify the necessity for a worldwide cryptocurrency regulation agency.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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Jai Hamid

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