Posted on

G-20 Summit Results: Crypto Is Important for Global Economy, Needs to Be Regulated and Taxed

Recap of the G-20 summit in Argentina.

Members of the Group of 20 (G-20), an international forum for the governments and central banks of countries with developed and developing economies, addressed cryptocurrencies in their recent declaration on sustainable development of the global economy.

Declaration summary: Crypto is important, but it needs to be put under scrutiny and tax regulations

On Dec. 1, the G-20 declaration titled “Building Consensus for Fair and Sustainable Development” was published on the official website of the Council of the European Union and the European Council. The document summarized the 13th gathering of G-20 nations that took place on Nov. 30 and Dec. 1 in Buenos Aires, Argentina.

The declaration addressed crypto regulation, albeit briefly: Cryptocurrencies are mentioned just once there, in the broader context of an “open and resilient financial system” that “is crucial to support sustainable growth.”

While recognizing the importance of the cryptocurrency industry for the global economy, the G-20 also noted that it will introduce Anti-Money Laundering (AML) and anti-terrorist measures per standards of Financial Action Task Force (FATF), an intergovernmental body formed to fight money laundering and terrorist financing:

“We will regulate crypto-assets for anti-money laundering and countering the financing of terrorism in line with FATF standards and we will consider other responses as needed.”

Further, in the same segment of the declaration, G-20 participants expressed a positive stance on non-bank financial institutions, pointing out the potential advantages of technology in the financial sector, given that the tech innovators are managing associated risks:

“We look forward to continued progress on achieving resilient non-bank financial intermediation. We will step up efforts to ensure that the potential benefits of technology in the financial sector can be realized while risks are mitigated.”

There is more crypto-related news coming from the international summit, however. On Dec. 2, Japanese news outlet Jiji reported that the G-20 countries have also called for the international taxation of cryptocurrency. According to the publication, the final text of a document cooperatively prepared by G-20 leaders outlines “a taxation system for cross-border electronic payment services.”

The article specifies that — under current laws — foreign companies that do “not have a factory or other base in Japan” cannot be taxed by the local government, while the G-20 leaders seek to “build a taxation system for cross-border electronic services.”

The Japanese news outlet also mentioned an estimated deadline for the system, saying that the final version of regulations, after considering proposals from each member state, is expected to be introduced by 2020. The issue will reportedly be discussed next year, when Japan will become the host of the summit and Japanese Prime Minister Shinzō Abe will take the position of G-20’s president.

Previous G-20 commentary on crypto

G-20 officials have previously maintained a ‘hands-off’ approach on crypto. In March 2018, after a call from France’s finance minister, Bruno Le Maire, the G-20 participants concluded the first public debate on virtual currencies.

The meeting resulted with a “firm” July deadline that had been put forward for “very specific recommendations” on how to regulate cryptocurrencies globally, despite the Financial Stability Board (FSB) — the group which coordinates financial regulation for the G-20 economies — resisting calls from some G-20 members to discuss regulating cryptocurrencies at the conference.

Moreover, many of the G-20 participants decided that cryptocurrencies needed to be examined further before making a concrete regulatory move, albeit some countries including Brazil stated that they won’t be following the G-20 recommendations.

Nevertheless, the G-20 members agreed that the FATF would have its standards applied to the cryptocurrency markets in the respective countries, a position they recently reiterated in Buenos Aires:

“We commit to implement the FATF standards as they apply to crypto-assets, look forward to the FATF review of those standards, and call on the FATF to advance global implementation. We call on international standard-setting bodies (SSBs) to continue their monitoring of crypto-assets and their risks, according to their mandates, and assess multilateral responses as needed.”

In July, a summary of provisional decisions made by the dedicated Finance Ministers & Central Bank Governors said that “technological innovations, including those underlying cryptoassets [sic], can deliver significant benefits to the financial system and the broader economy.” Nevertheless, the document also listed various related problems, including tax evasion and AML concerns:

“Crypto-assets do, however, raise issues with respect to consumer and investor protection, market integrity, tax evasion, money laundering and terrorist financing.”

Still, the actual recommendations for how to approach the cryptocurrency sphere at the international level were not presented, and the deadline was pushed to October 2018:

“[W]e ask the FATF to clarify in October 2018 how its standards apply to crypto-assets,” the summary read. It is unclear if those recommendations have been presented to date, as there has been no information from the G-20 regarding that issue.

On Oct. 22, as the G-20 remained silent, Jeremy Allaire, the CEO of the Goldman Sachs-backed crypto investment app Circle, stated that crypto-related regulatory matters have to be addressed “at the G20 level.” Prior to that, on Oct. 19, the FATF said that by June 2019, jurisdictions will be obliged to license or regulate cryptocurrency exchanges and some firms providing encrypted wallets internationally as part of AML and anti-terrorism procedures.  

More international action

In separate news regarding international adoption and regulation of crypto technology, on Dec. 4, seven southern EU countries — including France, Italy, Spain and Malta — formed an alliance called the “Mediterranean seven” with the aim to promote the use of Distributed Ledger Technology (DLT) among governments, as per Financial Times. The EU, as well as Italy and France, are members of the G-20 alliance.

More specifically, the EU countries have reportedly signed a declaration stating that areas like “education, transport, mobility, shipping, land registry, customs, company registry, and healthcare” can be “transformed” and boosted with the use of DLT.

“This can result not only in the enhancement of e-government services but also increased transparency and reduced administrative burdens, better customs collection and better access to public information,” the declaration reportedly states.

Posted on

G20 Members Note Crypto Regulation in Recent Declaration on Sustainable Development

G20 members noted crypto regulation in a declaration on sustainable development adopted in Argentina.

The G20 mentioned crypto regulation in its recent declaration on sustainable development adopted in Argentina. The declaration was published on the official website of the Council of the European Union and the European Council Dec. 1.

At a meeting in Buenos Aires on Nov. 30 and Dec. 1, G20 officials reiterated their concerns about the crypto industry along with its overall agenda regarding the future of work and infrastructure for development.

The declaration entitled “Building consensus for fair and sustainable development” regards cryptocurrencies as an important part of an “open and resilient financial system” that “is crucial to support sustainable growth.”

While recognizing the importance of the cryptocurrency industry for the global economy, the G20 noted that it will introduce anti-money laundering (AML) and anti-terrorist financing measures per Financial Action Task Force (FATF) standards.

G20 participants also expressed a positive stance on non-bank financial institutions, pointing out the potential advantages of technology in the financial sector provided that the tech disruptors are managing associated risks:

“We look forward to continued progress on achieving resilient non-bank financial intermediation. We will step up efforts to ensure that the potential benefits of technology in the financial sector can be realized while risks are mitigated.”

G20 officials have previously expressed a “soft” stance on crypto, stating that they will continue a “hands-off approach” towards crypto regulation. In July, a summary of interim decisions made by the dedicated Finance Ministers & Central Bank Governors said that “technological innovations, including those underlying cryptoassets, can deliver significant benefits to the financial system and the broader economy.” However, the document noted:

“Crypto-assets do, however, raise issues with respect to consumer and investor protection, market integrity, tax evasion, money laundering and terrorist financing.”

As Cointelegraph reported yesterday, G20 leaders have urged the global community to develop taxes on cryptocurrencies, calling for “a taxation system for cross-border electronic payment services.”

 

Posted on

G20 Wants Unified Crypto Regulation and Taxation

Leaders of the G20 group gathered in Buenos Aires over the weekend and cryptocurrency was on the agenda.

A final communique was published on Sunday to sum up the meeting and part of it called for unified regulations and a global approach to digital currencies. As reported by FXstreet the organization confirmed its commitment to using all political tools, including digitalization of the global economy and crypto assets, to promote global growth.

The publication also stated that G20 leaders are seeking to “build a taxation system for cross-border electronic services.” They are reportedly already working on such a system and aim to introduce it next year when Japan will be the president of the summit. After considering proposals from each member state a final version of the regulations are expected to be implemented by 2020.

G20 participants have agreed to develop a unified approach to crypto regulation in compliance with the standards of the Financial Action Task Force (FATF);

“We will continue to monitor and, if necessary, tackle emerging risks and vulnerabilities in the financial system; and, through continued regulatory and supervisory cooperation, address fragmentation. We look forward to continued progress on achieving resilient non-bank financial intermediation. We will step up efforts to ensure that the potential benefits of technology in the financial sector can be realized while risks are mitigated. We will regulate crypto-assets for anti-money laundering and countering the financing of terrorism in line with FATF standards, and we will consider other responses as needed,”

Earlier this year high ranking officials in the French and German governments issued a letter calling for more discussion on regulating cryptocurrencies. Japan, which has recently updated its ICO regulations, has also called for a more unified global approach to digital currencies. Leading companies in the industry have also called for a code of conduct regarding digital assets.

Back in July the G20 asserted that cryptocurrencies do not pose a threat to the global financial system. However they have persevered in monitoring developments in the nascent industry. As with most nations and central banks the greatest concern is money laundering so AML and KYC regulation will be at the forefront of any discussions and decisions.

The G20 is an international forum for government officials and central bankers from the world’s 20 largest economies. Member states represent 85% of global economic output, 66% of the world’s population and 75% of international trade.

Crypto markets did not react directly to the news but have retracted by a few percent on the day as they drop back to $130 billion.

The post G20 Wants Unified Crypto Regulation and Taxation appeared first on Ethereum World News.

Posted on

G20 Country Leaders Call for International Cryptocurrency Taxation

Leaders of G20 member countries have started work on an international cryptocurrency taxation system.

The G20 countries have called for the taxation of cryptocurrency, as well as its regulation to combat money laundering, Japanese news outlet Jiji.com reports Dec. 2.

According to Jiji.com, the final text of a document jointly delivered by G20 leaders calls for “a taxation system for cross-border electronic payment services.”

The article then specifies that under current laws, foreign companies that do “not have a factory or other base in Japan” cannot be taxed by the local government. The publication then cites that the G20 leaders seek to “build a taxation system for cross-border electronic services.”

The member states, which gathered this weekend in Buenos Aires, Argentina, are reportedly at work on the system and “will consider the issue during 2019 when Japan will be the president of the summit.” A final version of regulations, after considering proposals from each member state, is reportedly expected to be in place by 2020.

As Cointelegraph reported in October, the CEO of the company behind the cryptocurrency investment app Circle had called for “normalization at the G20 level” of the crypto industry.

In July, France’s finance minister Bruno Le Maire also called on the G20 to have a public debate about cryptocurrencies at this weekend’s summit.

Le Maire said that leaders will “have a discussion all together on the question of Bitcoin (BTC)” since “there is evidently risk of speculation.” He then concluded that France needs to “examine this with other G20 members” to see how “we can regulate Bitcoin.”

Posted on

G20 Crypto Regulations Could Unleash Real Blockchain Change

Jonathan M. Padilla is a Schwarzman Scholar at Tsinghua University where he wrote the dissertation “New Regulations for the New Economy: A Proposal for the G20 on the Regulation of Cryptocurrency,” from which this article was adapted.

He has advised major e-commerce and natural resource companies on blockchain integration and has a background in government and politics.


In March of this year, G20 central bankers and finance ministers met in Buenos Aires to discuss everything from international trade to investment in global infrastructure. Among the topics covered was the regulation of cryptocurrency, which has attracted the growing attention of government regulators and political actors as blockchain adoption becomes more widespread and cryptocurrency markets gain a broader following.

Since then, the G20 has begun to intensely study ways to de-risk cryptocurrency markets and craft regulation that will not stifle the innovative potential of blockchain. While many entrepreneurs and investors in this space fear that compliance with government will hinder future growth, the reality is that engaged cooperation offers the best possible path toward a potential tipping point that accelerates adoption of blockchain technology by major enterprise-grade users and brings in far greater institutional investors.

With central bankers and finance ministers slated to discuss cryptocurrency this summer in Argentina and with the full G20 to meet in late November, action or inaction here will impact cryptocurrency markets. How the blockchain community chooses to engage between now and then has the potential to set the tone of how governments and entrepreneurs develop a long-term relationship.

As Mark Carney, Governor of the Bank of England and Chair of the G20’s Financial Stability Board, noted in March of 2018, blockchain has “the potential to improve efficiency and inclusiveness of both the financial system and the economy,” but unleashing this potential will require substantial work.

An ideal forum

The G20 was originally formed as a forum for finance ministers and central bank governors after the Asian debt crisis of 1997. It’s since become a body for cooperation among heads of state to address challenging economic issues of the time.

In the wake of the Great Recession, the G20 created the Financial Stability Board to better coordinate prevention of and coherent responses to financial instability. Since its inception, the FSB has been critical to enhancing banking regulations through the Basel Accords, an opt-in transnational framework designed to strengthen the resiliency of global financial systems, and to promoting good economic governance policies.

The G20, along with the FSB, provides the best opportunity for a global regulatory framework as they 1)  convene the most relevant stakeholders and decision makers, 2) can craft a framework that is transnational in scope, and 3) are already studying cryptocurrencies and their impacts to a number of different fields.

Any regulatory framework will require cooperation from heads of government who possess the political power to move legislation and balance domestic considerations, from finance and economic ministers who have the technical ability to craft good policy and execute laws, and from central bankers who have a huge impact on the regulation of commercial banking within their respective states.

Additionally, the G20 can ensure whatever framework does take shape is transnational in nature as issues such as tax evasion, money laundering, and investor protection transcend borders. Such a framework would also minimize the risk posed by regulatory arbitrage to nations where firms can exploit loopholes in order to gain advantages based on geography.

Lastly, with G20 member states and FSB staff already working on these issues, there is attention, focus, and a desire to craft policy that will not stifle innovation.

The agenda

Different nations have taken different approaches to the regulation of cryptocurrencies and related fields. While a comprehensive framework is likely years away, there are a few key points that stand out in crafting a regulatory setup.

The simplest issue that the G20 and FSB can mediate is deciding on a working definition of cryptocurrency. Several nations such as Switzerland through FINMA and Israel through the Israeli Securities Agency have taken steps to do this in a way that classifies cryptocurrency into payment tokens, utility tokens, and security tokens.

Clarity on this front will not be easy but defining cryptocurrency will allow entrepreneurs and investors much firmer ground on which to build projects and governments more guidance on how to regulate.

Accepting that all the information required to regulate does not yet exist is another important point. This thought lends support to the creation of sandboxes like what the U.K.’s Financial Conduct Authority is doing on fintech that will provide both flexibility and capacity to evolve to meet the demands of the industry as it matures.

On exchanges, the leadership shown by Japan, with the Financial Services Agency requiring licenses and working with self-regulating organizations (SROs) to help police the space and mainstream cryptocurrency should be lauded.

Exchanges will be critical to figuring out how banks interact with cryptocurrency and how taxes will eventually be collected. As the value of the cryptocurrency market increases more and more attention to know-your-customer (KYC) and anti-money-laundering (AML) compliance will follow.

Industry impact

Collectively, some of the issues above could be woven together to mirror efforts that G20 has taken on banking regulation. A Zug or Valletta Accords, comparable to Basel, could create an opt-in framework where nations agree on basic tenets for regulating cryptocurrency with active input from the industry.

Increased regulation, however, will not mean that blockchain and cryptocurrency projects die. On the contrary, increased regulation, as long as it is done with the cooperation of industry stakeholders and with the aim of de-risking the broader market, will hasten blockchain adoption by large enterprise users and reassure institutional investors.

Numerous large firms have already begun to explore blockchain applications and potential use cases to streamline costs and gain a competitive advantage with their peers. With a regulatory framework in place, the internal and external compliance requirements of publicly traded companies can be met and the true growth stage of the traditional S-curve can begin.

Working with regulators, industry stakeholders can help craft rules where both entrepreneurs and governments win. Such a framework by the G20 could be just the action required to help unleash the long-term creative potential and promise of blockchain.

G20 flag image via Shutterstock.

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Posted on

G20 Hears Out Multiple Crypto Reports in July, Waiting for FATF to Test Its Standards by October

The G20, after it was called upon by France’s finance minister Bruno Le Maire to have a public debate about cryptocurrencies at the G20 Summit in Buenos Aires, made strides towards a global front for regulation of digital currencies.

Those strides could however be only considered baby steps as, at the conclusion of a meeting of the finance ministers in March it was decided that July would be the deadline for “very specific recommendations.”

The recommendations were not about what to regulate, but rather, what data is needed.

Now, with the July deadline come and gone, the G20 has reiterated its March commitments, but has also decided to move to a new deadline of October where it will await the Financial Action Task Force (FATF) clarification on how its standards apply to what it calls crypto-assets.

The path to taking crypto seriously

The speculation and hyper growth that saw Bitcoin easily smash through the $10,000 barrier through November 2017 certainly caught the eye of investors, but it also brought the decentralized and anonymous digital currency into the spotlight of global regulators.

The French finance minister’s suggestion that cryptocurrencies be part of the G20 talks in Argentina coincided with the peak of Bitcoin’s price high.

When commenting on the G20 nations taking up the topic of Bitcoin, Bruno Le Maire indicated a certain nervous attitude toward the skyrocketing asset.

“I am going to propose to the next G20 president, Argentina, that at the G20 summit in April we have a discussion all together on the question of Bitcoin. There is evidently a risk of speculation. We need to consider and examine this and see how with all the other G20 members, we can regulate Bitcoin.”

However, even before the Bitcoin boom, there were attempts by cryptocurrency groups to try to catch the attention of important governmental summits, and to be part of important global economic discussions.

For example, in November 2014, the Australian Digital Currency Association (ADCCA) purposefully scheduled their own event to overlap with the G20 in Brisbane Australia.

Ron Tucker, ADCCA Chairman, explained the reason behind the move in 2014:

“With Australia chairing the G20 this year, there is no better time to engage with relevant stakeholders to make sure the digital currency industry can continue to grow and prosper at home and globally.”

While it is hard to track the effectiveness of this move, it could have helped the ADCCA create a partnership with Deloitte in 2015. Australia now could be regarded as a strongly, but fairly, regulated cryptocurrency continent.

Blockchain benefits

Before the G20 were gearing up to discuss the potential risks and dangers of Bitcoin to global financial stability, they were already looking into the potential benefits of the underlying technology.

In March 2017, a statement from Julie Maupin of the Centre for International Governance Innovation detailed the need for a joint effort to “fight to restore the public’s faith in cross-border economic cooperation.” This included a decisive look at blockchain technology as a potential solution.

At this stage, though, there were merely whispers and suggestions about the potential of blockchain technology; there were no concrete plans to work with such disruptive fintech. In fact, a Deloitte report from around the same time suggested that world governments were not ready.

No longer ignored, no longer a threat

After Bitcoin was tabled as a topic of discussion for the finance ministers, the cryptocurrency world watched which direction the leaders of such powerful nations would go in relation to the new financial technology.

The first indications the discussions may be positive for cryptocurrencies came as Bank of England governor and head of the Financial Stability Board (FSB) Mark Carney told G20 members that crypto assets “do not pose risks” to the world’s economy. This saw Bitcoin’s price jump $1,000.

“Whether you call it crypto assets, crypto tokens – definitely not cryptocurrencies – let that be clear a message as far as I’m concerned.”

This definition from Klaas Knot, president of De Nederlandsche Bank NV, who also chairs the FSB standard committee on the assessment of vulnerabilities, positioned Bitcoin in a way in which it would not be as harshly regulated if it was considered money.

Gathering data before making a regulatory move

The conclusion on the March meeting for the G20 financial leaders saw them decided to give it some time before instituting anything specific.

The announcement, on March 19, came from Argentina Central Bank chair Federico Sturzenegger:

“In July we have to offer very concrete, very specific recommendations on not ‘what do we regulate?’ but ‘what is the data we need?’”

So, with July being the decided upon deadline by the G20 to offer specific recommendations on what data is needed for the regulation of cryptocurrencies they looked to commissions and committees to supply information.

Thus, they called upon a number of different bodies, as the Financial Stability Board (FSB), the Committee on Payments and Market Infrastructures (CPMI), International Organisation of Securities Commissions (IOSCO), Basel Committee on Banking Supervision (BCBS) and the Financial Action Task Force (FATF), to report back.

July’s report

In July the FATF came back with a report, but the G20 decided to set a new October deadline. According to a communiqué, the G20 waited to see how the FATF can apply its standards to cryptocurrencies.

Meanwhile, a report from the FSB was also received outlining the work it had done with the other standard-setting bodies. Different commissions and committees provided a deeper explanation how crypto assets would impact the global economy.

IOSCO’s work was focused on addressing the regulatory risks of initial coin offerings and crypto-asset platforms.

The BCBS was involved in monitoring crypto-asset developments from the perspective of strengthening the regulation, supervision and practices of banks: “quantifying the materiality of banks’ direct and indirect exposures to crypto-assets; clarifying the prudential treatment of such exposures; and monitoring developments related to crypto-assets and FinTech for banks and supervisors.”

Finally, the CPMI was monitoring the development of digital currencies and distributed ledger technology from the perspective of the safety and efficiency of payments and settlements, cautioning banks which are thinking of launching their own central bank digital currency (CBDC).

Meanwhile, the FSB itself was involved in conducting an initial assessment of the risks posed to financial stability by the growth of crypto-assets.

Financial stability concerns

At first, the FSB stated that the rise of cryptocurrencies posed a low financial stability risk. However, in light of the rapid developments in the cryptocurrency market, the FSB and the CPMI were requested to collaborate and develop a framework to support the monitoring and identification of emerging financial stability risks.

“The objective of the framework is to identify any emerging financial stability concerns in a timely manner. To this end, it includes risk metrics that are most likely to highlight such risks, using data from public sources where available.

“The FSB selected metrics for the monitoring framework based upon several criteria, including comparability over time and across jurisdictions, ease of access and repeatability, degree to which the metric is anchored in data, and analytical effort to compute.”

Essentially, the FSB has been monitoring the closing price and market capitalization, the price volatility and the monthly average of daily transactions. These can be seen as graphs within the report.

Chart

Source: Financial Stability Board

Classification of crypto-assets and exchanges

The IOSCO’s work on monitoring ICOs and exchanges has brought up the following:

“First, issues like whether a traded crypto-asset is a security, commodity, or some other financial product, or the manner in which such platforms operate, are threshold questions in the context of financial regulation.

“Second, so-called ’crypto-exchanges’ may be exchanges that are failing to comply with the laws applicable to exchanges. In some cases, they may be classified as intermediaries and may also be failing to comply with applicable laws.

“Finally, existing regulatory models may rely on access through a regulated entity to support many investor protection and other regulatory objectives, such as surveillance, but access to crypto-asset platforms currently may not involve such regulated entities.”

Also the Securities and Exchange Commission (SEC) in the USA is forging forward with its definition of what a security is, painting many ICOs as securities.

Additionally, the way in which exchanges are being run is a point of high contention, especially in places like Japan and South Korea. The former has taken it upon itself to issue business improvement orders to a number of exchanges, while the latter has classed them as legal entities which fall under banking legislation.

FATF’s standards implementation

The FATF, with its mandate from the G20 to develop a program to implement standards preventing money laundering and terrorist financing through crypto-assets, has released its working program which will come into force from July 1, 2018 until June 30, 2019.

“Under the US presidency, FATF will prioritise work on preventing the financing of the proliferation of weapons of mass destruction; expand the current emphasis on combating terrorist financing and foster improvements in the regulation and supervision of virtual currencies/crypto-assets.”

The FATF also looked into the different G20 nations and their regulatory needs and approaches.

“Some countries have prohibited the use of all virtual currencies/crypto assets, or have prohibited financial institutions from dealing in virtual currencies/crypto-assets.

“Several countries apply anti-money laundering/countering the financing of terrorism regulations to virtual currency/crypto-assets. Some countries do not specifically regulate virtual currencies/crypto-assets or exchanges dealing in them, but have broad-based requirements to report suspicious transactions. Many countries are in the process of establishing law or regulations.”

Regulation and deadlines

With October being set as the next point in which the G20 will come together to take further steps toward global cryptocurrency regulation, it is interesting to see how much the cryptocurrency space will have evolved in this time.

The wording of the document announcing this decision gives an impression of a balanced approach to cryptocurrencies as they currently stand:

“Technological innovations, including those underlying crypto-assets, can deliver significant benefits to the financial system and the broader economy.”

However, there is a caveat suggesting other concerns surrounding crypto’s use for tax evasion and money laundering which will hopefully be further addressed and explored with the FATFs program.

“Crypto-assets do, however, raise issues with respect to consumer and investor protection, market integrity, tax evasion, money laundering and terrorist funding.”

It signed off by stating:

“We reiterate our March commitments related to the implementation of the FATF standards and we ask the FATF to clarify in October how its standards apply to crypto-assets.”

Posted on

Bitcoin Builds on Recent Gains, Pushing $7,750 While Major Altcoins See Losses

July 23: Following a major upswing that kicked off on July 16, Bitcoin (BTC)’s price performance has diverged from other top cryptocurrencies. As Coin360 data shows, the top coin continues to build on its recent gains, while most major alts are struggling to maintain positive momentum.

Market visualization from Coin360

Market visualization from Coin360

Bitcoin (BTC) is trading around $7,740, up 3.17 percent over the 24 hour period at press time. The leading cryptocurrency has been gradually inching towards an ever higher price point all week, consolidating growth following sharp spikes on both July 16 and July 17.

Today, BTC dominance by market capitalization in the total crypto market posted its highest level yet in 2018, passing 46 percent, a threshold last seen December 22, 2017, when the coin was trading just below all-time highs of around $20,000.

Percentage of total market cap (dominance) from CoinMarketCap

Percentage of total market cap (dominance) from CoinMarketCap

Bitcoin’s weekly and monthly gains are in positive territory, at about 15.8 and 24 percent respectively.

Bitcoin 7-day price chart. Source: Cointelegraph Bitcoin Price Index

Bitcoin 7-day price chart. Source: Cointelegraph Bitcoin Price Index

Ethereum (ETH) has failed to hold its recent gains, with the top altcoin trading around $452 at press time, down 2.55 percent over the 24 hour period. After an intra-weekly high of $510 on July 18, the asset’s subsequent downturn saw it trading as low as $444 by July 20, before reclaiming some ground to its current levels. Ethereum has now lost 5.66 percent on the week, 6.42 percent on the month.

High point in Ethereum’s 7-day price chart. Source: Cointelegraph Ethereum Price Index

High point in Ethereum’s 7-day price chart. Source: Cointelegraph Ethereum Price Index

On CoinMarketCap’s listings, all of the top 10 coins by market cap, except for Bitcoin, are seeing losses of between 1 and 5 percent over the 24 hour period at press time.

IOTA (MIOTA) has lost 3.7 percent on the day, trading at roughly $0.95 at press time, according to CoinMarketCap. Cardano (ADA) has lost just shy of 3.68 percent and is trading around $0.16 over the past 24 hours to press time.

Of the top 20 ranked coins on CoinMarketCap, anonymity-oriented altcoin Monero (XMR) is the strongest performer, up 4.24 percent and trading around $135 at press time. Peaking at $148 July 18, the coin saw a subsequent decline to $127 July 21, and traded sideways until today’s strong upswing.

Monero 7-day chart. Source: CoinMarketCap

Monero 7-day chart. Source: CoinMarketCap

Total market capitalization of all cryptocurrencies is around $284 billion at press time, down from its intra-weekly high of around $299 billion.

Weekly high in the total market capitalization of all cryptocurrencies from CoinMarketCap

Weekly high in the total market capitalization of all cryptocurrencies from CoinMarketCap

Earlier today, the Cointelegraph reported on significant remarks from former vice president of North American investment banking at JPMorgan Chase, who suggested that blockchain “may be the key to avoiding the next global financial crisis.”

China, which upholds its hardline stance towards decentralized crypto assets, has seen a wave of positive blockchain-related news. Today, Nanjing, the capital of China’s Jiangsu province, launched a $1.48 billion blockchain investment fund to foster the development of the token economy and public blockchain projects, as well as the country’s three major telecoms operators launching a blockchain research group

A positive view of blockchain with more circumspection towards cryptocurrencies was shared by the G20’s Finance Ministers & Central Bank Governors (FATF) group at a meeting this weekend. FATF postponed making hasty regulatory recommendations for crypto assets until October, after earlier suggestions that it would move to advocate “very specific” measures for the emerging sphere.

Posted on

G20 Forum Shelves Deadline for ‘Very Specific Recommendations’ on Crypto

Cryptocurrencies will continue to receive a broadly hands-off approach from the G20 until at least October, a meeting of the forum confirmed July 21-22.

A summary of interim decisions made by the dedicated Finance Ministers & Central Bank Governors (FATF) group sees any hard-and-fast regulatory steps regarding cryptoassets remain absent.

The results follow a four-month consultation period which FATF enacted during a previous gathering in March. At the time, representatives said they were obliged to create what they called “very specific recommendations” for how to approach the cryptocurrency sphere at international level.

In the intervening months, however, it appears that position has considerably softened.

“[W]e ask the FATF to clarify in October 2018 how its standards apply to crypto-assets,” the summary requests.

In brief comments about the general mood towards cryptocurrency, the G20 adopts a similarly balanced view, stating the technology contains both “benefits” and “risks.”

“Technological innovations, including those underlying crypto-assets, can deliver significant benefits to the financial system and the broader economy,” the document continues:

“Crypto-assets do, however, raise issues with respect to consumer and investor protection, market integrity, tax evasion, money laundering and terrorist financing.”

Such vocabulary echoes the angle that emerged from G20 activities throughout the year, and also represents more recent comments from constituent participants such as the European Union. Earlier this month, a French government report under finance minister Bruno Le Maire, who had publicly called for the G20 to debate cryptocurrency, likewise recommended avoiding direct regulation.

Posted on

G20 Calls for Cryptocurrency Vigilance, Eyes October 2018 Deadline for Standardized AML Monitoring

The G20 says cryptocurrencies do not pose a threat to the global financial system. Notwithstanding, the G20 wishes to maintain a careful observance of the emerging market to preventing its use in illicit financial activities. Earlier in the month, the Financial Stability Board (FSB) had issued a press release saying the same thing.

G20 Agrees With FSB

The G20 member states declared their position as part of a communique issued on Sunday (July 22, 2018). According to the communique, the G20 believes that cryptos and their underlying technologies can significantly benefit diverse sectors of the global economy. Many experts believe that blockchain technology can be applied to solve problems in different areas of the global business process.

Crypto-assets do, however, raise issues with respect to consumer and investor protection, market integrity, tax evasion, money laundering, and terrorist financing. Crypto-assets lack key attributes of sovereign currencies. While crypto-assets do not at this point pose a global financial stability risk, we remain vigilant.

In a recent letter to the finance ministers and central bank governors of G20 member states, the FSB had given the same assessment. The FSB also announced that it was working in collaboration with the Committee on Payments and Market Infrastructures (CPMI). The two agencies aim to create a robust, standardized framework for monitoring cryptocurrencies. In the lead up to the G20 summit of March 2018, FSB chairman, Mark Carney told the G20 that Bitcoin and other cryptos didn’t pose any threat to global finance as well.

G20 Wants Standardized AML Monitoring for Cryptocurrency

Earlier in the year, Japan called on the G20 to look into the use of cryptocurrency in money laundering and terrorist financing. It appears the Group is now seriously making efforts towards establishing a standardized monitoring framework to combat the use of cryptos in illegal financial activities.

According to Sunday’s communique:

We [the G20] welcome updates provided by the FSB and the SSBs and look forward to their future work to monitor the potential risks of crypto-assets and to assess multilateral responses as needed. We reiterate our March commitments related to the implementation of the FATF standards, and we ask the FATF to clarify in October 2018 how its standards apply to crypto-assets.

Do you agree with the G20’s assessment of the emerging cryptocurrency market? Keep the conversation going in the comment section below.

loading…