On December 13th, the International Monetary Fund (IMF) recently issued some recommendations on how to effectively supervise the global cryptocurrency field.
The IMF stated that crypto assets are disrupting the existing financial system. Therefore, it should be regulated globally in a comprehensive and consistent manner. The IMF emphasized that uncoordinated regulatory measures may “promote potentially destabilizing capital flows.” Because most cryptocurrency companies operate across borders.
In this regard, the IMF lists three core requirements that regulators must include: First, cryptocurrency service providers with several key functions should be licensed or authorized. Including the transfer, storage, settlement and custody of digital assets. The standards for issuing licenses should also be clearly defined and relevant agencies should be designated. Second, these requirements should be suitable for the main use cases of these encrypted assets. For example, investment products should have similar requirements to securities brokers and should be supervised by securities regulatory agencies. Payment products should have requirements similar to those of banks and should be supervised by the central bank. Third, governments of different countries should authorize regulated financial institutions to provide clear and comprehensive cryptocurrency risks and participation details.