The International Monetary Fund (IMF) has made recommendations to regulate the cryptosphere and provide a framework for exchanges and investors to work with.
First, we want crypto service providers to be licensed, registered and approved. This includes services that provide storage, transfer, exchange, settlement and custody services, subject to rules similar to those governing providers of services in the traditional financial sector. You want to keep your client’s assets separate from your own and clearly define responsibilities.
Second, entities performing various functions in the cryptosphere must undergo additional oversight. Any conflicts of interest should be evaluated by the responsible authorities and, where appropriate, prohibited, and such entities should be subject to strict regulations on transparency to ensure that all dependencies and operations are clearly identifiable. must be subject to
Third, stablecoin issuers must follow strict prudential requirements as they become stores of value for more investors. Without proper supervision and regulation, such holdings could destabilize currency and financial stability. Major stablecoins may require regulation on the scale adopted by the banking sector.
Fourth, established financial institutions dealing with cryptocurrencies must follow clear requirements regarding risks arising from trading cryptocurrencies. Fifth, we need a robust global cryptocurrency regulatory and supervisory framework. The borderless nature of cryptocurrencies highlights the ineffectiveness of national authorities to properly handle digital coins, and only a rapidly adaptable and unified approach is suitable.
Of course, the IMF’s recommendations are recommendations only. The cryptocurrency world remains a relatively unregulated area, and there is still no consensus on what a global regulatory framework will look like or be implemented.