An organization created by the G20 countries has published recommendations for “consistent and comprehensive” regulation of the cryptocurrency sector. The recommendations are based on suggestions made in October aimed at preventing the troubles that have happened to companies such as FTX and Celsius.
“The events of the past year have highlighted the inherent volatility and structural vulnerability of cryptoassets and related market players,” the document says.
In justifying the stricter global rules, the FSB also recalls the recent collapse of cryptocurrency-focused banks, the brief unbinding of stable coin Circle USDC two months ago, and the sudden fall of stable coin terraUSD in May 2022.
In April, India’s finance minister urged G20 nations to develop uniform standards for regulating cryptocurrencies globally.
Earlier, FSB Chairman Klass Knot said his agency has become more cautious about stablecoins because of the potential risks stablecoins could pose to financial stability. Knoth shares the view of most global regulators that the stablecoins on the market may not comply with international norms set by the developers of payment or securities standards.