French Finance Minister Bruno Le Maire, German acting Finance Minister Peter Altmaier, Central Bank of France head Francois Villeroy de Galhau and Central Bank of Germany President Jens Weidmann, have officially called for crypto regulations to be placed in the G20 agenda in a letter to the finance minister of Argentina, current holder of the rotating G20 presidency.
“We believe there may be new opportunities arising from the tokens and the technologies behind them,” the signatories said before adding:
“However, tokens could pose substantial risks for investors and can be vulnerable to financial crime without appropriate measures. In the longer run, potential risks in the field of financial stability may emerge as well.”
They further argued extensive regulations should apply to cryptos just as in traditional finance, with the ministers and bankers stating:
“Great efforts have been made in recent years to protect retail investors and consumers more generally, and there is no reason that appropriate frameworks should not be applicable in this sector…
The buildup of individual exposures to such volatile tokens could have damaging consequences for misinformed investors who do not understand the risks.”
Bruno Le Maire, who has said of bitcoin “I don’t like it,” and the other three signatories said cryptos were “largely mislabeled as ‘currencies’ in the media and on the internet.”
Which might suggest a lack of awareness regarding just how cryptos operate and the significant diversity that can be found in this space between different digital currencies and tokens.
Because many accept payments in bitcoin, eth, or other cryptos, with plenty making such payments. BitPay, for example, has handled some $1 billion worth of crypto payments last year.
But the letter was not unexpected. The French finance minister has called for a crypto G20 for some time, with Germany then joining. Yet the Japanese Central bank has said any G20 co-ordination on crypto regulations would be difficult.
Jurisdictional competition and differing interest of G20 members might make any squaring of the circle quite a task, especially considering the variety of different crypto functions.
The ministers, however, have called for a study to be undertaken on the matter by G20, but even if they do manage to agree at that level other smaller countries, such as Switzerland, might eye opportunities if unreasonable proposals are laid out.