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Cryptos pose no risk to global financial stability: Carney says the FSB G20

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The Financial Stability Board (FSB), an international body that oversees the global financial system to promote stability and coordinate Financial regulation for the G20 countries rejected calls by some G20 members to regulate cryptocurrencies like bitcoin.

In a letter [PPDF] sent to G20 finance ministers and central bank governors on the eve of the G20 summit in Argentina, FSB Chairman Mark Carney stressed that cryptocurrencies are not a threat for the global financial system. review by the authority.

Carney, who is also Governor of the Bank of England, revealed that the FSB had undertaken a review of the financial stability risks posed by the "rapid growth" of cryptocurrencies in response to the concerns of G20 members.

He went on to declare:

"The FSB's initial assessment is that crypto-assets pose no risk to global financial stability at this time."

"This is partly because they are small compared to the financial system.Even at their highest peak, their aggregate market value combined accounted for less than 1% of global GDP," he said. -he adds. "In comparison, just before the global financial crisis (in 2008), the notional value of credit default swaps represented 100% of global GDP."

The FSB review determined that, for the time being, the relatively restricted use of cryptocurrencies as fiduciary money substitutes and 'very limited use of the economy real and financial transactions "mean limited links to the broader financial system for cryptocurrencies.

This initial assessment could change, Carney added, if cryptocurrencies entered the core of the regulated financial system or became payment instruments.

The remarks come at a time when crypto-regulation is widely reported as a burning debate among G20 members at this week's meeting. The G20, an international forum of governments and central bank governors of the world's 20 largest economies. Japan, in particular, plans to urge its G20 counterparts to take steps to prevent the misuse of cryptocurrencies in money laundering, as previously noted. German and French finance officials have also jointly proposed unified regulatory guidelines for cryptocurrencies.

Despite consumer and investor concerns about cryptocurrencies and their use or abuse in illicit activities, Carney reminded finance ministers and G20 central bank chiefs:

"The technologies that underpin them have the potential to enhance the efficiency and inclusivity of both the financial system and the economy."

G20 government officials are expected to hold meetings that will include discussions on the regulation of cryptocurrencies on Monday and Tuesday.

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