The G7 countries are discussing the possibility of tighter crypto regulation and ways to help developing nations introduce central bank digital currencies (CBDCs) in line with international standards. The Group of Seven consists of Canada, France, Germany, Italy, Japan, the U.K., and the U.S., with the European Union also attending meetings. Japan holds the Presidency of the G7 this year, and its Vice Minister of Finance for International Affairs, Masato Kanda, stated that the discussions on crypto and CBDCs will be part of the G7 efforts to address challenges the global community is facing from fast-moving digital technology.
Kanda explained at a seminar in Washington on Tuesday that the collapse of crypto exchange FTX last year was a serious wake-up call for policymakers to create regulation across borders. He emphasized that while the rapid innovation of digital technology has benefits, it has also brought new challenges, including cyber-security, the spread of misinformation, social and political divides, and the risk of destabilizing financial markets. For crypto assets, there are diverging views among countries, but consensus is definitely that we need more regulation, particularly after the FTX shock.
The vice finance minister noted that different countries are at different stages of CBDC development. The US, for example, has not decided whether to launch a digital dollar. Federal Reserve Chairman Jerome Powell recently said that the Fed’s CBDC is in the early stages of experimentation. On the topic of CBDCs, the Japanese official shared, “As a priority of this year, the G7 will consider how best to help developing countries introduce CBDC consistent with appropriate standards, including the G7 public policy principle for retail CBDC.” He emphasized that risks from the development of CBDC must be addressed by ensuring factors such as appropriate transparency and sound governance.
The G7 seeks to assist developing countries in introducing CBDCs to ensure consistency with international standards. Kanda stated that the discussions will prioritize how best to help developing countries introduce CBDCs consistent with appropriate standards, including the G7 public policy principle for retail CBDC. The vice finance minister emphasized that we must address risks from the development of CBDC by ensuring factors such as appropriate transparency and sound governance.
In conclusion, the G7 countries are discussing the possibility of tighter crypto regulation and ways to help developing nations introduce CBDCs in line with international standards. The discussions will prioritize how best to help developing countries introduce CBDCs consistent with appropriate standards, including the G7 public policy principle for retail CBDC. The rapid innovation of digital technology has brought new challenges, including cyber-security, the spread of misinformation, social and political divides, and the risk of destabilizing financial markets. Therefore, risks from the development of CBDC must be addressed by ensuring factors such as appropriate transparency and sound governance.
