Finance Minister Nirmala Sitharaman, who is in the US to attend a series of meetings, said that G20 members have agreed that there should be a globally coordinated understanding to regulate the crypto assets and also to deal with the challenges related to it. She said crypto assets are not backed by central banks and can fall and cause macroeconomic instability.
On Thursday, Sitharaman after meeting G20 member ministers said that all the members have responded to the issue with alacrity and during India’s presidency of the G20. A “synthesis paper” will be taken up on matters related to crypto assets, the minister told a press conference in Washington on Thursday.
“I am glad to say that there is a greater acceptance among all G20 members, that any action on crypto assets will have to be global,” Sitharaman and added that “the G20, I think, has responded fairly with alacrity (on the crypto challenge),” she said.
India has always maintained it wants a collective global effort to deal with problems posed by cryptocurrencies, such as bitcoin, ether. The finance ministry in February said it had held a seminar for G20 member states to discuss how to come up with a common framework.
On the sidelines of the annual spring meeting of the International Monetary Fund (IMF) and the World Bank, Sitharaman along with Reserve Bank of India Governor Shantikanta Das co-chaired a meeting of finance ministers and central bank governors from member countries.
Sitharaman said: “The way in which we are seeing this pan out during our presidency is the IMF’s paper is being discussed, FSB’s paper also will be taken up, and a synthesis paper will be prepared from the IMF paper and the FSB paper both put together.”
There will be a discussion in September and October, and in the “end of the day, we will see a roadmap being readied on how and what kind of understanding the members of the G20 have in this, and it can be taken further forward on specific actions of regulation as and when the G20 takes a call on it”, the finance minister said.
She added that the work done by the FSB and the IMF indicate that crypto assets, particularly those that are outside of central banks, being not backed by any sovereign asset, can cause macroeconomic instability.
“So, today, we are in the position to see how countries are now recognising that it is not just a crypto asset regulatory issue, where countries will have to come together, but the IMF dealing with it has also brought in this time mention that they can be issues of macro economic stability itself,” she said.
“Today, I am very glad to have heard the European Central Bank chief Christine Lagarde speak about specific examples of how money has been routed into this operation, resulting in too many such companies who are getting involved in it raising questions of where the trail is,” the minister said on Thursday.
Cryptocurrencies as a payment medium in India are not regulated by any central authority, like RBI. There are no rules and regulations or any guidelines laid down for settling disputes while dealing with cryptocurrency.
The Centre via a notification dated March 7, 2023, has brought digital assets and fiat currencies, virtual digital assets (cryptocurrencies) and such other digital assets, their trading, safe keeping and related financial services under the ambit of the Prevention of Money Laundering Act (PMLA).
(WIth PTI inputs)
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