The FSB wants to corner the crypto industry
The Financial Stability Board (FSB) recently published new elaborations dedicated to the crypto industry. In it, the international financial organization wrote down which specifications of the blockchain industry should apply. So far, the claims have been very general. In a conversation, on the other hand, a leading employee sounds much more drastic.
FSB does not want to leave any hiding place for the crypto industry
The Financial Stability Board (FSB) does not want to leave the crypto industry with any hiding place. Secretary-General John Schindler made this clear in an interview with Reuters after the international organization published four final reports yesterday, all of which deal with cryptocurrencies.
In the reports, the FSB summarizes debates that have taken place with various organizations and companies. The international financial organization based in Basel specifically invited in advance to express opinions and comments on guidelines that were published on October 11, 2022.
In it, the FSB warned of alleged negative consequences that would arise from the increasing spread of cryptocurrencies. The organization spoke of risks to the global stability of the financial system.
Consequently, the Financial Stability Board called for the creation of international rules for dealing with crypto currencies and the crypto industry. According to the latest report , financial institutions and crypto companies in particular contacted the FSB, who agreed with the assessment.
In addition, the organization published a final version of the required guidelines related to cryptocurrencies and crypto activities, as well as a specific version for stablecoins.
The demands formulated there sound quite basic and lack unexpected or conspicuously restrictive content. For example, nation states are being asked to cooperate with other states to enforce existing laws in the crypto industry.
Schindler’s comments to Reuters sound much more drastic. As the secretary-general said yesterday, “crypto players must stop operating outside of the regulatory framework or in non-compliance with existing regulations.”
Schindler is therefore calling on all countries around the world to follow the guidelines of the FSB – even those that are not members of the Financial Stability Board. One does not want to leave a single hiding place for the crypto industry, headlines Reuters.
So far, many crypto companies have operated from island states – such as the Seychelles or the Cayman Islands – which grant them extensive freedoms. The companies are therefore not accessible to more restrictive states.
Crypto industry uses missing laws as an excuse?
Schindler also suggests that the crypto industry is using the lack of legislation regulating the industry as an excuse to avoid applying legal requirements. The work of the FSB should finally put an end to this.
These actors can no longer argue with a lack of legal clarity because our framework clearly specifies the standards to be applied.
The legal handling of the crypto industry and cryptocurrencies is increasingly being discussed. Just recently, the US reached a milestone with a court ruling partially classifying the cryptocurrency XRP as a security .
In the EU, the legislature is currently introducing the MiCA law, which is considered new due to its requirements for the crypto industry.
The guidance of the Financial Stability Board is likely to be amended to include further details due to its general nature. The Basel Committee on Banking Supervision and the international securities authority IOSCO could be responsible for this . Adjustments by the respective states are also obvious.
The FSB wants to finalize its decisions by the end of 2025. If everything goes as planned, the participating states will then put the guidelines into practice.
