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G7 countries demand that crypto assets be regulated quickly and comprehensively

The Group of Seven (G7) industrialized nations' finance ministers and central bank governors met in Bonn and Königswinter, Germany, on May 18–20.

Following the recent market upheaval and the collapse of cryptocurrency terra (LUNA) and algorithmic stablecoin terrausd, one of the things they discussed was the regulation of crypto assets (UST).

"The G7 supports the Financial Stability Board's (FSB) work to monitor and address financial stability risks arising from all forms of crypto-assets, and welcomes increased global cooperation to address regulatory issues associated with the use of crypto-assets, including in cross-border payments," the communique summarizing the finance leaders' key decisions said.

The finance ministers of the G7 added:

"In view of recent market turbulence, the G7 urges the FSB... to accelerate the formulation and implementation of consistent and comprehensive regulation of crypto-asset issuers and service providers."

The FSB will work on crypto regulation "in close conjunction with international standard-setters" with the goal of holding crypto-assets, including stablecoins, to the same norms as the rest of the financial system, according to the communiqué.

"In particular, the G7 urges for the FATF's 'travel rule' to be implemented quickly, as well as better disclosure and regulatory reporting, for example, on reserve assets underpinning stablecoins," the finance chiefs stated.

"We reiterate that no global stablecoin project should go live until it meets all necessary legal, regulatory, and supervision criteria through appropriate design and adherence to applicable standards."

The communique continues, "The G7 remains committed to high regulatory standards for global stablecoins, based on the concept of same activity, same risk, same regulation."

Following the demise of LUNA and UST, a number of governments have asked for the regulation of crypto assets, particularly stablecoins, to be implemented as soon as possible.

Treasury Secretary Janet Yellen told Congress last week that regulating stablecoins is necessary and urgent. She specifically addressed Terrausd's fall. This week, the UK government confirmed its resolve to regulate stablecoins.

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