U.S. Treasury Department Says G7 Officials Agree The Need to Regulate Cryptocurrencies

On Monday, December 7, finance ministers of the G7 economies met to discuss the economic outlook ahead with the ongoing COVID-19 economic crisis. The U.S. Treasury Secretary Steven Mnuchin hosted these discussions as central bank governors from Canada, France, Germany, Italy, Japan, the United Kingdom, the European Commission, and the Eurogroup, joined.

Much importantly, the top officials discussed the rapidly emerging landscape of cryptocurrencies and the need to regulate the digital currency market. The official statement reads:

The Ministers “discussed ongoing responses to the evolving landscape of crypto assets and other digital assets and national authorities’ work to prevent their use for malign purposes and illicit activities.  There is strong support across the G7 on the need to regulate digital currencies.  Ministers and Governors reiterated support for the G7 joint statement on digital payments issued in October”.

In recent times, regulators worldwide have stepped-up measures to regulate the digital currency market as central banks have been actively working on launching their CBDCs.

Recently, speaking at the Singapore FinTech Festival, Standard Chartered CEO noted that the roll-out of digital currencies is absolutely inevitable as international payments are rapidly evolving. He also called for a coordinated effort between public and private players for the developing the framework of digital currencies.

“I think there is absolutely a role for central bank digital currencies as well as non-central bank-sponsored digital currencies,” he added.

On the other hand, soon as the G7 meeting concluded, Germany’s finance minister Olaf Scholz slammed Facebook’s Libra project - now renamed as Diem. In his sharp attack, Scholz said:

“A wolf in sheep’s clothing is still a wolf. It is clear to me that Germany and Europe cannot and will not accept its entry into the market while the regulatory risks are not adequately addressed. We must do everything possible to make sure the currency monopoly remains in the hands of states.”

As big players from the financial world continue to join the crypto market, regulators will take crypto regulations more seriously. This year, big hedge fund managers and financial institutions have poured massive sums of money in Bitcoin as an inflation hedge against the ongoing economic crisis.

Recent rumours in the market suggest that the U.S. Treasury Secretary is planning to bring an impactful crypto ruling that can ban digital-asset wallets. This ruling can also forbid users from using any third-party personal crypto wallets outside of the regulated exchanges.