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‘Global rules on cryptocurrencies needed’

Updated October 23, 2018

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.— Reuters/File
.— Reuters/File

LONDON: Major economies should launch coordinated regulation of cryptocurrencies, the head of Goldman Sachs-backed startup Circle said on Monday, underscoring growing industry support for international rules on digital money.

“Ultimately there needs to be normalisation at the G20 level of critical crypto-related regulatory matters,” Jeremy Allaire, CEO of Boston-based Circle, told Reuters in an interview in London.

The move by Paris-based Financial Action Task Force (FATF) is a significant step towards international standards for a sector known for weak consumer protection, volatile prices and frequent security breaches. FATF said jurisdictions worldwide would have to license or regulate cryptocurrency exchanges and other related companies to help stamp the use of coins for money laundering and terror financing.

Such rules are a good start, Allaire said, but should be broadened to cover the issuance of digital money by private companies – through so-called initial coin offerings and how exchanges deal with market manipulation, and the identification of customers.

National regulators have mostly taken differing approaches to rules for cryptocurrencies. Some, such as Japan, have adopted frameworks for licensing exchanges, while others, like China, have shut them down. The industry is largely unregulated across Europe.

Still, major countries including France and Switzerland have this year moved towards crafting rules for initial coin offerings, and Britain’s financial watchdog is also looking at the sector.

Published in Dawn, October 23rd, 2018

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