The International Monetary Fund (IMF) has called for more regulation relating to the crypto industry, pointing to the prevalent use of these digital assets in countries that may be considered corrupt or have strict capital controls.
With the industry’s market capitalization of over $2 trillion, the sector has expanded beyond the purview of regulations in many countries.
This lack of uniform rules has been a major cause of concern for global authorities, including the IMF. While countries such as the US have developed a framework that prevents money laundering, terrorism financing and fraud through crypto – many countries lack such a framework.
Recent IMF study points to possible corruption
A recent IMF study that surveyed 55 countries found that crypto assets “could be used to transfer corruption proceeds or to circumvent capital controls.” From 2,000 to 12,000 respondents from each country, participants in the IMF study were asked whether they used or owned digital assets in 2020, an echo of previous practice where the IMF called for more consistent crypto regulations across international borders. Was.
Last year, the IMF published a blog post detailing how crypto was interacting with the traditional financial system, noting that a lack of regulations made it difficult for policymakers to monitor the risks of these interactions. Was.
The IMF also suggested how the crypto sector should be regulated globally, recommending licenses for crypto service providers and establishing clear guidelines and requirements for regulated financial institutions exposed to crypto.
FCA Removes UK Crypto Firms From Its Registration List
While there is no global regulatory framework for crypto yet, several countries have doubled down on their efforts to regulate crypto. In the UK, the Financial Conduct Authority (FCA) has been at the forefront of crypto regulations, recently announcing that five firms have been added to its approved list of crypto service providers in the country.
Since 2020, the UK regulator has obliged cryptocurrency service providers to obtain licenses in the country before operating, and will be forced to close firms that are officially closed by the previously ordered March 31 deadline. are not registered with. Similarly, the US is currently working towards providing a more clear regulatory framework, but is still struggling to provide the necessary clarity.
Currently, President Biden’s recent executive order on crypto will provide much needed clarity over the long term. The European Union[ईयू]It is also taking steps to provide guidance on how to regulate digital assets.
However, there are still many countries, such as India, where crypto is not regulated. Even though the country has taxed crypto, it has yet to implement a regulatory framework on how the industry should operate.
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