FSB to set crypto regulatory norms globally

Rebeca Moen  Dec 13, 2022 10:16  UTC 02:16

2 Min Read

According to Dietrich Domanski, who is stepping down from his position as secretary general of the Financial Stability Board (FSB), recent events have shown that it is "necessary to manage risks" inside the industry.

The collapse of the FTX exchange prompted action from a global financial body, which in turn led to ideas in early 2023 about how to control the cryptocurrency market.

It has been said that the Financial Stability Board (FSB), an international organization that is responsible for monitoring the global financial system, has declared that it would be laying out plans to regulate cryptocurrencies over the course of the next year.

Domanski also stated that one of the goals of developing suggestions for cryptocurrency regulation would be to hold cryptocurrency projects "to the same standards as banks" if the projects are providing services that are comparable to those that are provided by banks. This statement was made in reference to Domanski's earlier statement.

The recent failures of important cryptocurrency ventures such as Terraform Labs and the FTX exchange have led to widespread criticism of the decision by policymakers throughout the globe to let the FTX market to flourish before to erupting.These rules and regulations, according to the official from the FSB, would not have fulfilled the "conditions for effective administration," therefore they would have prevented scenarios such as the collapse of Terra and FTX.

The Financial Stability Board (FSB) wants to create a timeline for the first ideas to be adopted by global authorities over the next several months. Following the presentation of recommendations, the Financial Stability Board (FSB) reaches a consensus on a set of guidelines. These guidelines may then be codified into law by a number of different national and regulatory authorities.

The former chief executive officer of FTX, Sam Bankman-Fried, was taken into custody by the Royal Bahamas police not too long ago, and he is due to be deported to the United States. After the United States government sent Bankman-Fried with an official notification that it had filed criminal charges against him, he was taken into custody by law enforcement.The list of allegations includes not just money laundering but also conspiracy to commit wire and securities fraud, as well as the more common offenses of wire and securities fraud.

A few hours before he was brought into detention, Bankman-Fried contested the allegation that he was a participant in a Wirefraud discussion group that was reportedly made up of FTX employees.

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