The Group of 20 (G20) is an international organization for different countries in Europe, Asia, America, and even African countries. Recently, they want to hold their summit in India, where they will discuss many issues concerning the crypto industry. Some of the points they will raise are shocking. A crypto analyst on Twitter with the username @CryptoKingKeyur made a profound analysis of some of the points they will raise in the meeting. We will break down some of these points in this article. Let’s dive in!
Blanket Bans are Ineffective for the Crypto Industry
- According to @CryptoKingKeyur on Twitter, one of the crucial points for the G20 Summit is the issue of total bans on crypto. So, the leaders in the Summit say a total ban on the crypto industry isn’t effective.
- Total bans may lead to crypto activities moving to other jurisdictions. Furthermore, it will lead to risk spillovers.
Targeted Restrictions are Better for the Crypto Industry
- Targeted bans are another point for the summit. According to those attending the summit, the use of total bans proved not effective. So, the government should move on to targeted bans.
- An excellent example of this is the restrictions Dubai puts on privacy coins. Furthermore, the restrictions the Nigerian government placed on crypto firms.
Concerns Around Stablecoins
- At the summit, another area of concern about the crypto industry is the issue of stablecoins. So, the leaders believe stablecoins might threaten currency stability in emerging economies.
- They also think stablecoins might become more attractive than foreign currency bank accounts. This might cause citizens to prefer using stablecoins over their own currency. Furthermore, it can also cause abrupt volatility.
Concerns Around Crypto as a Legal Tender
- There’s another place the G20 is having issues with the crypto industry. They don’t want crypto to become level tender for countries. So, they are saying that the Central Bank of countries shouldn’t hold crypto assets due to monetary and global financial stability risks.
- Exposing the government’s inadequacies is another concern. So, the thing is that crypto can expose government revenues to exchange rate risks.
Concerns Around Emerging Markets Risks and Framework & Policy Importance
- There are countries with large numbers of unbanked people. The crypto industry often serves as a means of making transactions. However, the G20 thinks crypt poses a risk to the unbanked.
- Another issue here is the regulatory framework and policy of the crypto industry. So, the G20 believes regulation is very crucial.
G20 Wants Global Coordination Around the Crypto Industry
- One of the characteristics of the crypto industry is that it is borderless. So, this is a concern for the G20 for their upcoming summit.
- The international body firmly believes there’s a need for global coordination around the crypto industry. Furthermore, leaving one nation alone to fight the industry isn’t effective.
Concerns Around Money Laundering
- The International Monetary Fund and the Federal Security Service (FSB) expressed concerns about money laundering. So, the bad aspect of the crypto industry is that criminals often use it to send money. This money goes into the funding of terrorism and other acts that destroy lives and property. Furthermore, corrupt people often use cryptocurrencies to hide their money.
- This is a concern for the G20 for their summit. So, they have come up with some strategies to help curb this. One of them is adopting standards like those from the Financial Action Task Force (FATF). Furthermore, frameworks like this will help reduce issues like this.
Concerns Around Market Failure in the Crypto Industry
- One of the things the G20 points out in their upcoming summit is the scenario where a major player in the crypto industry fails. So, when something like this happens, it usually has a ripple effect on the whole industry.
- We saw what happened with FTX. How many crypto firms working with the failed exchange went down the drain. Furthermore, the FTX collapse contributed to the current bear market the crypto market is facing from 2022. Things like this are what the G20 is trying to avoid.
G20 on Roadmap and International Efforts
- In their upcoming summit, the G20 will emphasize that they are making a global roadmap for crypto. So, they want many countries worldwide to work together to regulate the sector.
- The international organization emphasizes global coordination, cooperation, and information sharing. Furthermore, they are trying to address data gaps to understand the crypto ecosystem better.
Conclusion
One of the biggest highlights for the G20 Summit in India is around the crypto industry. So, they will raise many points concerning the crypto industry and how they plan to address it. One of the things they emphasize on is the regulation of the crypto industry. Also, they plan to coordinate with all the countries around the world to stop certain crypto crimes, such as money laundering.
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