They are not backed by any underlying assets and evidently have no value beyond the virtual realms, but cryptocurrencies have vexed policymakers and the world’s central bankers alike over the past few years. With the collapse of a few prominent crypto exchanges in the past year, resulting in heavy losses for investors, the clamour for a tighter regulation of cryptocurrencies, if not a total ban, has grown louder in recent years. The issue was taken up seriously at the recently-concluded G20 summit, held under India’s presidency in New Delhi, where some of the world’s largest economies came together to agree on the contours of a broad set of regulations that could be put in place as early as October this year.
Industry estimates say there could be as many as 420 million crypto investors worldwide. The G20 leaders’ declaration incorporates recommendations from the Financial Stability Board (FSB), which covers the “regulation, supervision and oversight of crypto-assets activities and markets and global stablecoin arrangements”. Stablecoins are cryptocurrencies whose value is pegged, or tied, to that of another currency, commodity, or financial instrument. According to the FSB guidelines, as reported in the media, stablecoins must adhere to the same regulations as
