G-20 Finance Officials to Discuss Crypto Asset Regulations

Tokyo, June 6 (Jiji Press)--The Group of 20 finance ministers and central bank chiefs are expected to discuss in Japan this weekend regulations on crypto assets, which could damage financial stability. The issue will be examined at a two-day meeting of the G-20 advanced and emerging economies in Fukuoka from Saturday, because the digital assets can be used for money laundering and systems to protect users are underdeveloped. How to regulate crypto assets will be a major problem. Many G-20 members have introduced regulations on virtual currency exchange operators, but rules vary from country to country. A country with lax regulations may become a loophole. In 2018, Tokyo-based virtual currency exchange operator Coincheck Inc. got large amounts of customer crypto assets stolen. But it was difficult to trace the destinations of the stolen assets, barred by anonymity in crypto transactions. The incident laid bare insufficient user identity checks at digital currency exchange operators. The G-20 officials are expected to draw up guidelines for regulations concerning user protection and identification, make a list of relevant government officials in their countries and strengthen international cooperation. The G-20 participants are also seen discussing how to adapt their rules to situations in which individuals and companies carry out through blockchain technologies financial transactions directly between them without using financial institutions. Under the current regime involving financial intermediaries, authorities can secure financial stability by monitoring and regulating banks and other financial institutions. But the existing regulatory method would not work for the decentralized regime that directly connects users. The G-20 officials are expected to confirm related problems and agree on the need to accelerate their discussions. END