A thematic review on an international regulatory framework for crypto-asset activities has been released by the Financial Stability Board (FSB). The evolution and growth of crypto-asset markets highlights the importance of implementing the FSB’s recommendations for crypto-assets as well as global stablecoins. The report from the FSB looks at the implementation of the organization’s 2023 global regulatory framework for crypto-asset activities.
Based on information as of August of this year, the latest report describes the progress made so far in implementing the FSB recommendations for crypto-asset activities and service providers, and stablecoins, respectively. It focuses primarily on data reporting and appropriate disclosures frameworks in place, as well as financial stability risk monitoring approaches “across jurisdictions; and describes the tools, progress, and challenges in cross-border cooperation and coordination.”
As stated in the latest FSB report, crypto-asset markets and regulation are evolving and the review shows jurisdictions have made considerable progress in regulating crypto-asset activities and “to a lesser extent global stablecoin arrangements.”
But it also reveals gaps and inconsistencies that could potentially pose risks to financial stability and to “the development of a resilient digital asset ecosystem.”
As mentioned in the update from the FSB, uneven implementation creates various opportunities for regulatory arbitrage and “complicates oversight of the inherently global and evolving crypto-asset market.”
To address this, the report puts forward eight different recommendations which are addressed “to jurisdictions as they develop their regulatory regimes, and to the FSB, SSBs, and international organisations as they consider further work on the subject.”
The International Organization of Securities Commissions (IOSCO) has also undertaken “a thematic review on the implementation of IOSCO’s Crypto and Digital Asset framework, focusing on investor protection and market integrity.”
A joint information note provides an overview of the overall scope as well as the findings of the FSB and IOSCO’s complementary reports.
