G7 Countries Will Discuss Crypto Regulation In Next Meeting: Report

Last updated: May 18, 2022
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G7 countries will be discussing global crypto regulations at their next meeting later this week, says an official attending.

According to a report from Reuters, France’s central bank governor Francois Villeroy de Galhau said that regulation of crypto assets is on the agenda for G7 representatives. The banker hinted that UST’s big collapse may have prompted the officials to take a closer look at the subject.

“What happened in the recent past is a wake-up call for the urgent need for global regulation,” Villeroy told an emerging markets conference in Paris.

“Europe paved the way with MICA (regulatory framework for crypto-assets), we will probably ... discuss these issues among many others at the G7 meeting in Germany this week,” he added.

In a speech at the conference, the Bank of France governor said:

“...There is a risk of ‘private’ fragmentation through the disorderly development of crypto-assets, among which the somewhat misnamed “stablecoins.” As demonstrated by the turmoil on financial markets in recent weeks, they are possibly very unstable. We have long stressed the risks of such speculative investments. But it’s not enough: this must be taken as a powerful wake-up-call for a global regulation, which is urgently needed."

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"If they aren’t regulated in a global manner, cryptocurrencies could disrupt the entire international financial system," he said. “This is why I have spoken of the danger of fragmentation in payments akin to the Middle Age, with so-called ‘cryptocurrencies’ having limited constituencies and acceptance.”

In the same speech, de Galhau said that there was a need for regulators to promote the Euro’s international role as a “pillar of monetary cooperation.”

The French banker’s comments are part of a large wave of calls for global regulation in the crypto industry. Last month, before the TerraUSD debacle, European Central Bank (ECB) official Fabio Panetta called for a global framework for cryptocurrency regulations to combat what he referred to as the “Wild West.”

“This situation is clearly unsatisfactory, as crypto-assets are a global phenomenon and their underlying technologies can play an important role, not only in finance,” he said. “We need globally coordinated regulatory action to address issues such as the use of crypto-assets in cross-border illicit activities or their environmental footprint. Regulation should balance the risks and benefits so as not to stifle innovation that could stimulate efficiency in payments and broader applications of these technologies.”

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