The G20 is a group formed by the 20 most influential countries in the world economy (in which are countries such as the United States, Germany, Mexico, Japan, China, South Korea, Russia, India, France, among others).
In this sense, any decision taken by this group has a huge impact on the economy, and in the general world, that is why it has generated some concern when they announced that they would start taking action to regulate all the cryptoactive.
- 1 What has the G20 discussed about the crypto world so far?
- 2 What do you propose FATF with regard to the cryptoactive?
- 2.1 What other organizations have provided information so far?
- 2.2 What changes are planned to be made on the different continents?
What has the G20 discussed about the crypto world so far?
At the last summit held by the G20, we discussed the need to create a series of policies and laws, which could regulate the crypto world in general, this with the main objective of avoiding money laundering, tax evasion, among other things.
All this was discussed in December of the year 2018, in Argentina. However, there was little information about it, so far.
Currently all G20 member countries have been responsible for contributing with money and experts in the area, to try to determine what decisions should be taken to create the appropriate regulations for the Crypto world.
In addition, it has also been established that these regulations will come into play, once the next G20 summit is held, to be held on 28 and 29 June of this year (once the regulations are discussed and approved).
On the other hand, the G20 has reemphasized its support to the organization FATF (International Financial Action Group), and has been asked to provide information on the decisions to be taken in reference to the crypto world.
What do you propose FATF with regard to the cryptoactive?
In response to the request made by the G20, FATF has mentioned the following:
He emphasized that any provider of crypto services (exchanges, wallets, etc.) must be duly regulated by the government entities of the country where they are registered, in this way, it could be more easily detected any Suspicious activity or at least reduce the number of illegal transactions occurring daily with the cryptoactive.
In addition, this organization also mentioned the importance of countries collaborating in this process, as making public the information compiled from the crypto world would make decision–making more rapid.
What other organizations have provided information so far?
But this organization has not been the only one that has given information about it, since the Financial Stability Council (FBS) has delivered a full report, which talks about the crypto service providers that exist and the Countries where they are operating. In addition, the report also highlights the level of risk each of these suppliers has.
In addition, the Basel Committee on Banking Supervision (BCBS) is investigating the impact of criptomonedas on banks, and the level of banking operations that are directly or indirectly linked to the cryptoactive Management.
Even the international organization of Securities Commissions (IOSCO), has developed a framework of complete support, which has as main objective, regulate and control the ICOs, because these are those that represent a greater risk at the time of talking about scams.
It is important to mention that this organization also conducted a research framework to determine the level of risk that an ICO represents.
What changes are planned to be made on the different continents?
Although the G20 is formed by only 20 countries, it should be noted that this group also invites other countries at its last summit; These countries mentioned being committed to the actions that were raised at the summit.
It is for this reason that the regulations for the crypto-world proposed by the G20 will affect all continents, however, some are more affected than others.
Over the years, people have become accustomed to the large regulations made by the world’s economic powers, not applied so consistently in Latin America, however, this time will not be so (at least so members ensure of the G20).
We currently have the ability to oversee financial institutions working with cryptocurrencies. In addition, we also have the order to evaluate that bank transactions are linked to the crypto world; If we find one, we can take action, as the case may be.
The United States already has several regulatory organizations for the Crypto world. Among these organizations, the following can be mentioned:
The Federal Deposit Insurance Corporation (FDIC): This organization is responsible for supervising financial institutions that work with cryptocurrencies.
The Securities and Exchange Commission (SEC): This is responsible for regulating the cryptocurrencies that are considered financial assets.
The Futures Trade Commission (CFTC): This independent government organization is responsible for overseeing all crypto products in general.
Financial Crime Control Network (FINCEN): Thanks to this organization, legal action can be taken against people who in one way or another are committing crimes through the cryptocurrencies.
These financial institutions have not mentioned anything about the decision taken by the G20, but they are likely to provide information for the G20 ‘s decision-making this year.
In general, experts say that there will not be many changes in the United States at least, not significant changes that can put the stability of certain cryptoactive at risk.
With regard to Canada, this country also has several organizations that are responsible for regulating the cryptocurrencies, hence the decisions taken by the G20, will not affect much the trade in crypto in this country (or at least that is expected).
Finally, Mexico is located, where the Central bank is responsible for creating the necessary regulations to ensure the welfare of Mexican investors.
In this sense, the country had not made many decisions to regulate the cryptocurrencies, until the beginning of 2019, where certain rules were announced for the financial institutions that offered services for the Crypto world.
Several countries in Europe are already regulating the cryptocurrencies for a couple of years, however, this time Spain will join these regulations, because despite not being part of the G20, has been invited at the last summit and the representative has mentioned Also adopt the regulations proposed by the G20 this year.
On the other hand, the financial Markets Authority of France, issued all the regulations applied in the country, with respect to the cryptocurrencies. It is important to emphasize that these regulations will be adopted by other countries of the European Union or at least this is expected.
In general, more countries in the European Union are likely to adopt the regulations proposed by the G20, which can mean a severe blow to the market. However, no major changes are expected in already-regulated countries, such as France, the United Kingdom, among others.
Countries such as China and India currently have a strong regulation with respect to cryptocurrencies, however, allow their partial use (can be traded with some cryptocurrencies, but with others not).
In the financial institutions responsible for making such regulation, it should be noted that each country has an organization or department that specializes in the area.
On the other hand, the Bank of Indonesia has decided to completely prohibit the cryptocurrencies as a means of payment, although the investment in these is still allowed (although the idea of making a total ban is discussed).
With respect to the crypto transactions performed, the regulatory agency for Commodity Futures is responsible for making the corresponding regulations, as the cryptocurrencies are still considered financial assets.
Around Japan, the regulations are less invasive and allow free trade with cryptoactive, but the financial institutions responsible for brokering these negotiations are properly regulated to avoid money laundering.
West and central Asia
Russia currently regulates negotiations with cryptocurrencies, however, in February the government announced that it would increase the regulations; Not to mention, the changes proposed by the G20 will be applied.
For its part, in Turkey the Central Bank is responsible for making all the necessary regulations, and although there are few currently, the Bank is developing a series of rules and policies that must be met to ensure the Investor welfare.
With regard to Saudi Arabia, there is currently no regulation, but the government has proposed that the necessary investigations be started to create a regulatory framework that will guarantee the country’s economic stability.
Africa and Oceania
In South Africa, no regulation has yet been made for the crypto world, however, the Central bank is conducting the necessary studies, as in Saudi Arabia.
In Australia, the transaction Reporting and Analysis Center (AUSTRAC) currently regulates cryptocurrencies exchanges that are registered in the country. On the other hand, the Securities and Investment Commission is responsible for regulating the ICOs.
Finally, it is the Central Bank of Australia that is responsible for studying the risks that these financial assets represent for the country, and thus, is the financial entity responsible for creating the necessary regulations. Although they have not currently made changes in their structure, they are likely to also integrate the new regulations proposed by the G20.
Will all these changes affect the current crypto market?
Over the years, all countries have been making their own decisions to regulate the cryptocurrencies and their derivatives markets, however, a massive decision had never been made to start regulating the crypto world.
Although this is likely to negatively affect all markets involved, it should also be mentioned that this would mean an increase in security in crypto transactions, so it can mean a short-term downturn, but an increase in Long-term capital.
However, it is very hasty to draw conclusions at this time, as the regulations that are planned to be implemented are still unknown.