G7 to Discuss More Crypto Regulation and How to Help Developing Nations Introduce Central Bank Digital Currencies – According to a report by Reuters, Masato Kanda, the Vice Minister of Finance for International Affairs in Japan, stated that the G7 countries will be engaging in talks regarding stricter regulations on cryptocurrencies, as well as strategies to aid developing countries in implementing central bank digital currencies (CBDCs) in compliance with global standards.
The G7 is composed of the United States, Canada, France, Germany, Italy, Japan, and the United Kingdom, with the European Union (EU) also in attendance at their gatherings. This year, the G7 is being led by Japan as the current Presidency holder. During a seminar in Washington on Tuesday, Kanda elaborated that the discussions surrounding cryptocurrencies and CBDCs will be a component of the G7’s endeavors to confront the obstacles posed by swiftly advancing digital technology, as stated in a report.
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He stressed that the collapse of crypto exchange FTX last year “was a serious wake-up call” for policymakers to create regulation across borders, elaborating: “For crypto assets, there are a bit of diverging views among countries. But consensus is definitely that we need more regulation, particularly after the FTX shock.” The deputy finance minister acknowledged that the swift advancement of digital technology has advantages, but it has also introduced fresh obstacles such as cybersecurity threats, the proliferation of false information, societal and political rifts, and the potential for destabilizing financial markets.
On the topic of central bank digital currencies, the Japanese official shared: “As a priority of this year, the G7 will consider how best to help developing countries introduce CBDC consistent with appropriate standards, including the G7 public policy principle for retail CBDC.” The vice finance minister emphasized: “We have to address risks from the development of CBDC by ensuring factors such as appropriate transparency and sound governance.”
The development of central bank digital currencies (CBDCs) varies among countries, with each at a different stage. For instance, the United States has yet to determine whether they will introduce a digital version of their dollar. Recently, the Chairman of the Federal Reserve, Jerome Powell, revealed that their CBDC is still in the initial phase of experimentation. This discrepancy in progress can be attributed to factors such as regulatory hurdles, technological readiness, and public acceptance.
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