Crypto Regulation Needs Global Consensus

On Sunday, Nirmala Sitharaman, Finance Minister of India, said that global consensus is necessary for crypto regulation to be effective.

The Finance Minister of India on Sunday emphasized the need for global consensus regarding regulating cryptocurrencies. FM Sitharaman said collaboration would be necessary to create a global framework for crypto regulation to be effective. She stated:

No one country individually, in a matter of technology-driven, a crypto asset, can effectively control it, because technology doesn’t have any borders, it can just pass through.

So the very character of it being technology driven requires all countries to be on board, or else it will not be effective.

However, Minister Sitharaman said this did not mean controlling “distributed ledger technology.”

The Economic Times reports Sitharaman said:

The G20, of which India is currently holding the Presidency, it was India’s proposal, and it has been taken on board. I’m glad that the G20 has kept it in its agenda for this year, the IMF has given a paper on cryptocurrency and the way it can affect macroeconomic stability.

The Financial Stability Board (FSB), which was set up by G20, has agreed to give a report that will also focus on financial stability.

The FM said that India had submitted its proposal on crypto regulation in the G20 agenda and will host a summit of Presidents and Prime Ministers of the Group of 20 (G20) in September.

She added:

Their (FSB) report and IMF’s report are going to be discussed in July when Finance Ministers and Central Bank Governors will meet under the G20, and post that in September, there will be a summit of Prime Ministers and Presidents of G20 nations that will be held in India.

Speaking about the importance of a global approach to the regulation of cryptocurrencies, Sitharaman commented:

The underlying principle is, because the digital currencies are completely digitalized and technology-driven, the technology which is very distributed, and sometimes identity is very difficult to be established, but which has potential, it will therefore have to be acted upon only with all countries coming on board.

India Maintains a Global Approach to Crypto is Necessary

Sitharaman previously commented on the need for a global stance on cryptocurrencies. Sitharaman said in a post-budget meeting with the Reserve Bank of India (RBI) that the Indian government is discussing a unified global approach to regulating cryptocurrencies with fellow G20 members.

She commented at the time that if a technology-driven asset such as crypto is to be regulated, “one country alone cannot do anything.

The FM said on another previous occasion when speaking about India’s desire to ban crypto:

Cryptocurrencies are, by definition, borderless and require international collaboration to prevent regulatory arbitrage.

Therefore, any legislation for regulation or for banning can be effective only after significant international collaboration on the evaluation of the risks and benefits and evolution of common taxonomy and standards.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.