The Financial Stability Board (FSB) has published document regarding regulatory challenges in the stablecoin market. The report is currently only of consultative nature, but contains alarming information about cryptocurrencies.
FSB is following the stablecoin market
The FSB is now publishing ten recommendations addressed to central banks and G20 authorities. It is particularly about unifying the global approach to supervision and regulation of cryptocurrencies. also The FSB suggests to authorities that if they cannot control and regulate fully decentralized stablecoins, they should consider banning them.
The board focuses primarily on the potential risks that stablecoiny could provide for global financial stability. It is especially about those projects that are dedicated to retail investors.
What power does the Council have?
However, one important thing is worth noting: although the FSB has no formal legal authority, its recommendations still influence the decisions of officials around the world.
The purpose of the current FSB recommendations is to help governments determine how to limit the potential financial risk caused by “Global coins stablecoin“.
Which is very worrying, recommendations also include “other assets cryptographic that may pose similar risks to those of stablecoins due to comparable international coverage, scale and use. ” It also falls under this scope Bitcoin!
In the following part of the report:
“Authorities should be able to limit the risks associated with some or specific stablecoins in their jurisdictions or prohibit their use if they do not comply with the relevant regulatory and supervisory requirements.”
The FSB recommends that relevant authorities in individual countries use their powers to regulate, control and even prohibit all activities related to the emission, management and trading or exchange of global stablecoins.
Consequently, this could mean a strong blow to Tether, and by the way, and other “stable cryptocurrencies.” These are issued today by digital currency exchanges and many other companies from this market.
You also can’t have the illusion that Facebook Libra could potentially be the first to fire, which has been feared by politicians and officials around the world for nearly a year.
Get notifications about important new market events.