CRYPTOCURRENCIES. Authorities are now preparing some recommendations on possible regulations for virtual currencies. Some jurisdictions eye to put in place regulations as early as 2024. In photo are (left to right) Bangko Sentral ng Pilipinas (BSP) Senior Assistant Governor Johnny Neo Ravalo, Financial Stability Board-Regional Consultative Group for Asia Co-chair M. Rajeshwar Rao, BSP Governor and Financial Stability Board-Regional Consultative Group for Asia Co-chair Felipe Medalla, and FSB Chairman Klaas Knot. (Photo by Joann S. Villanueva)
MACTAN, Cebu – High level recommendations on the regulation of crypto currencies are set to be submitted during the G20 meeting in July which Bangko Sentral ng Pilipinas (BSP) Governor Felipe Medalla said is necessary to address, among others, cross border movements of funds.
In a briefing after the 23rd Financial Stability Board Regional Consultative Group for Asia (FSB-RCGA) on Wednesday, FSB Chairman and De Nederlandsche Bank President Dr. Klaas Knot explained that the G20 has mandated the FSB to “come up with a global regulatory framework for crypto assets activities.”
He said they are now working on recommendations for stable coins and other crypto asset activities.
“For that meeting, we intend to deliver these high level recommendations but as the name suggested they are high level,” he said.
Crypto currencies are digital assets or virtual currencies that are still not regulated around the world but has attracted strong demand among investors since some are now being used for remittances, payments, investments, capital raising and exchange.
Bangko Sentral ng Pilipinas (BSP), for one, requires virtual currency (VC) providers to register with the central bank as they are being used for remittances and by transfer company.
To date, there are seven entities who were given provisional license for virtual currency exchanges.
Knot said FSB’s standard-setting bodies -- banking regulations, insurance regulations, and securities regulations, among others, “have to take on these recommendations and translate them to a more detailed guidance for the specific entities.”
He said the bodies “have already taken the opportunity so its moving in parallel.”
“They are moving as fast as they can as well because the industry is very rapidly moving so the quicker we can get it done, the better it is,” he said.
Klaas said some countries are now preparing for their own standards on this asset class “but 2024-2025, that is when most jurisdictions, there will be legislations being developed in order to protect these investors.”
He said the regional consultations aims to take stakeholders’ thoughts on the issues since there has to have a “truly global approach to crypto.”
“(It aims)to underline that global financial stability is truly a global public good and that can only be achieved if the standards that we set ourselves to ourselves are also implemented globally,” he said.
Medalla, during the same briefing, said regulations “become strict the moment crypto meets banking” since any cross-border movements “could be financing things that are quite destructive.”
“Indeed, our big problem is the Philippines is in the Gray list, which has possible consequences. That’s why we cannot afford, although we have had a moratorium of issuances of what we call VASP, Virtual Asset Provider. These are the things we want to address,” he said. (PNA)
