The Financial Stability Board (FSB) released its crypto regulation framework, to bring better regulation in the Crypto space & ensure the safety of investors.
The Financial Stability Board (FSB) is a global agency that closely monitors and issues recommendations about the international financial system. This agency was established in April 2009 after the G20 London summit as a successor to the Financial Stability Forum (FSF).
This week, The FSB agency released a digital assets regulation framework to suggest the lawmakers of every jurisdiction that the crypto regulation framework should be comprehensive and also should be similar to all jurisdictions. With the proposed crypto regulation framework, FSB aimed to maintain innovation in the Crypto sector.
“An effective regulatory framework must ensure that crypto-asset activities are subject to comprehensive regulation, commensurate to the risks they pose while harnessing potential benefits of the technology behind them. Such regulation should ensure equivalent regulatory outcomes where they pose risks similar to those posed by traditional financial activities while addressing novel features of crypto-assets,” the FSB said.
Agency also emphasized the need to restrict all the stablecoin issuer companies to remain under a policy, to prevent any kind of event occurrence like TerraUSD collapse. In short, lawmakers should monitor the back-end operations of the stablecoin issuer companies to ensure that they are constantly maintaining funds behind the issued stablecoin digital money.
The members of the FSB body will have time till 15 December to share their opinion on this suggested global regulatory framework.
Reportedly the latest step by the FSB agency came because of the significant downturn in the crypto industry and also the collapse of many crypto services, including digital assets, for example, Lunc coin, Ustc, Celsius, BlockFi, etc.