A framework has been developed for the G20 countries to “monitor the financial stability implications of crypto-assets markets.” The Financial Stability Board says cryptocurrencies “do not pose a material risk to global financial stability” but supports their “vigilant monitoring.”
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G20’s Crypto Monitoring Framework
The Financial Stability Board (FSB) announced Monday that it “has developed a framework and identified metrics to monitor the financial stability implications of crypto-assets markets.” The framework was developed in collaboration with the Committee on Payments and Market Infrastructures (CPMI).
The board also published and submitted a report detailing its work on crypto-assets to the G20 as requested by finance ministers and central bankers at the G20 meeting on March 19 and 20 in Buenos Aires.
The FSB is an international body that monitors and makes recommendations about the global financial system to G20, an international forum for governments and central bank governors. The CPMI supports financial stability by promoting the safety and efficiency of payment, clearing, settlement and related arrangements.
“The objective of the framework is to identify any emerging financial stability concerns in a timely manner,” the report states, adding:
The framework discusses the primary risks within crypto-assets and potential transmission channels to financial stability risks. The framework identifies which metrics the FSB might usefully monitor in the short-to-medium term.
The report also notes that “in general, monitoring the size and rate of growth of crypto-asset markets is critical to understanding the potential size of wealth effects, should a decline in valuations occur.” Furthermore, “the use of crypto-assets for payment or settlement is another transmission channel to be monitored.”
FSB’s Proposed Metrics
Citing that the crypto
