IMF and SPS introduced measures to regulate crypto assets

The Financial Stability Board (FSB) and the International Monetary Fund (IMF) have published recommendations aimed at regulating digital assets.

The initiative aims to bring together standards and different positions to help different jurisdictions mitigate the risks arising from crypto-related activities.

The report talks about the risks to financial stability in the event of stablecoin volatility.

With regard to DeFi protocols, the authors recalled that they “are not significantly different in function from Tradfi“. These platforms have the potential to amplify the risks and vulnerabilities of traditional systems—liquidity and maturity mismatches, operational fragility, interconnectedness, and excessive leverage, according to experts.

“Decentralization claims often do not stand up to scrutiny. Currently, DeFi may exhibit unclear, opaque, untested, or easily manipulated governance structures that can expose users to risks.”the document says.

The report mentions the position of the IMF on the advisability of regulating rather than banning the digital asset sector. A recommendation is made to the authorities to focus on resolving issues that determine the demand from consumers for new forms of payment.

The report ends with an implementation roadmap.

The document includes planned and ongoing work related to the implementation of the policy framework in the field of crypto assets, which together are aimed at:

• institutional capacity building outside G20 jurisdictions;
• strengthening global coordination, cooperation and information exchange;
• addressing the data gaps needed to understand the rapidly changing cryptocurrency ecosystem.

Recall that in July 2023, the Council presented recommendations on the global regulation of digital assets. The document establishes norms for issuers of stablecoins and trading platforms.

Previously, an advisory body to the G20 concluded that none of the existing “stablecoins” meets the standards set for crypto assets by the central banks of the largest economies.

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