The increase in the adoption and use of cryptocurrencies such as Bitcoin (BTC) has revealed the need for regulation in this area.
At this point, the Financial Stability Board (FSB), which brings together regulators in many jurisdictions such as the United States, European Union, China and the United Kingdom, has presented a new framework for the consistent and comprehensive regulation of the cryptocurrency industry.
Stating that this framework is based on the principle of “same activity, same risk, same regulation”, the FSB said in its report that these recommendations are based on the recommendations submitted in October.
Stating that these recommendations are focused on preventing the bankruptcy of more platforms such as FTX and Celsius, the FSB pointed out that more clear and precise steps should be taken so that investors do not suffer more from the crypto money sector.
“While the recommendations establish a global regulatory base, they may push some jurisdictions to adopt more restrictive regulatory measures.
These recommendations take into account feedback from public consultation and stakeholder outreach.
In line with the mandate of the FSB, the recommendations focus on regulatory, supervisory and oversight issues related to crypto assets to help promote secure innovation.
Therefore, the recommendations are Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT); data privacy; cyber security; consumer and investor protection; market integrity; competition policy; taxation; Money Politics; monetary sovereignty; and other macroeconomic concerns, does not comprehensively cover all specific categories of risk associated with crypto-asset activities.
At this point, the events of the past year have highlighted the structural vulnerabilities and structural weaknesses of crypto assets and related players.
Furthermore, the failure of a key service provider in the crypto-asset ecosystem has also demonstrated that it can quickly pass risks to other parts of that ecosystem.”
*Not investment advice.
