US Treasury: G7 finance officials back need to regulate digital currencies

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Finance ministers and central bankers from the G7 advanced markets strongly supported the need to regulate digital monies, the US Treasury Department said in a statement on Monday after a digital assembly of their officials.

German Finance Minister Olaf Scholz issued a harshly worded statement following the meeting, underscoring his worries about authorizing the launch of Facebook’s Libra cryptocurrency – newly renamed Diem – in Germany and Europe.

“A wolf in sheep’s clothing is still a wolf,” he explained. “It is clear to me that Germany and Europe cannot and will not accept its entry into the market while the regulatory risks are not adequately addressed.”

US Treasury Secretary Steven Mnuchin hosted the 12th meeting of the G7 finance officials that this year related to the COVID-19 pandemic as Washington prepares to hand over the presidency of the G7 to the UK next month.

The G7 finance officials discussed continuing responses to “the evolving landscape of crypto assets and other digital assets and national authorities’ job to stop their usage for malign purposes and illicit activities,” Treasury said.

“There is strong support throughout the G7 on the requirement to regulate digital currencies,” the statement said.

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The G7 officials reiterated their support for a G7 joint statement on digital payment in October, which said digital payments could improve access to financial services and cut inefficiencies and costs, but should be “appropriately controlled and regulated.”

Stablecoins are tied to a conventional money or basket of resources, and employed for payments or even for saving value.

Facebook announced plans in June to launch its digital currency but regulators around the globe fear it could destabilise the global financial system.

G7 finance officials discussed national and global economic responses to the COVID-19 pandemic, and strategies to attain a robust global recovery, the statement said.

The team at Platform Executive hope you have enjoyed this news article. Initial reporting via our official content partners at Thomson Reuters. Reporting by Andrea Shalal in Washington and Christian Kraemer in Berlin. Additional reporting by Tim Ahmann and Thomas Escritt. Editing by Chizu Nomiyama.

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