Central bankers have signalled that cryptocurrencies will face a high hurdle to win official sanction from government policymakers.
Senior government policymakers from around the world met today in Basel, Switzerland, to discuss the policy and regulatory issues arising from the development of so-called stablecoins, such as Facebook’s Libra, which are cryptocurrencies pegged to the value of a more stable underlying asset.
The meeting was hosted by the Bank for International Settlements (BIS), and convened by a G7 working group that is examining emerging stablecoins, with a report on the phenomenon slated for mid-October.
“As a new technology, stablecoins are largely untested, especially on the scale required to run a global payment system,” said Benoît Cœuré, chair of the working group, who also chairs the Committee on Payments and Market Infrastructures.
“They give rise to a number of serious risks related to public policy priorities. The bar for regulatory approval will be high,” added Cœuré.
“A key part of assessing new initiatives is to understand the details,” said Agustín Carstens, general manager of the BIS. “When such initiatives cross national borders, it’s important for regulators to coordinate and come to a common understanding.”