G20 nations are debating whether to ban crypto, according to RBI Governor

The final days of February 2023 have brought a G20 meeting, leading the member nations to discuss a number of important topics, one of which ended up being the crypto industry. While many were hoping to see the member nations agree over regulations for the industry, it appears that the meeting could go either way. Shaktikanta Das, the Governor of Reserve Bank of India (RBI), revealed that some members of G20 proposed a complete ban on digital assets, as they view the industry as risky, dangerous, and harmful.

Das made his comments following the conclusion of the two-day meeting, which saw the discussions between finance ministers and central bank governors of some of the most powerful nations in the world. The meeting, held in Bengaluru on February 25th, led to a number of discussions involving several topics, such as a proposal to create an international architecture for digital asset regulations.

India was, of course, one of the participating nations, and it proposed a joint technical paper in collaboration with Swiss Financial Stability Board (FSB) and the International Monetary Fund (IMF).

The idea is to create a paper that would help other countries, as well as their own, develop certain policies for the digital asset space by synthesizing macroeconomic and regulatory perspectives on digital currencies.

G20 members recognize the usefulness of blockchain

Nirmala Sitharaman, the Finance Minister of India, also commented on the meeting, stating that G20 members are not completely against digital assets. On the contrary, many have recognized that the technology underpinning cryptocurrencies can be useful for the financial industry.

With that said, they do not recognize crypto assets as currencies, as they were not issued by central banks. According to them, any asset that was issued by entities other than the central bank is not a currency. Sitharaman stated that several side events are proposed regarding crypto assetat the IMF-World Bank Spring Meetings in Washington in April. Meanwhile, FSB’s own paper involving crypto regulations will be available come July.

The paper, created by IMF and FSB, should form the basis for any future discussions involving cryptocurrencies, and particularly an international architecture for the industry. Das noted that the paper is a work in progress, but the discussions have already started. In the end, each country is a sovereign country, and they will make their own decisions. However, once G20 agrees on something, it would be expected that member nations follow the agreed position.

He also noted that the meeting revealed that the crypto industry is recognized and accepted as a major risk to the stability of financial industry, as well as that of monetary systems, not to mention cybersecurity issues that follow, as well.