Privately issued, globally usable stable coins beyond state control are probably the greatest nightmare of almost every central banker and finance minister. In its latest report on such stable-coin projects, the Financial Stability Board (FSB) has now put forward ten proposals to help governments regulate Libra & Co. The main pillars would have to be international cooperation between authorities and the maintenance of common standards. However, the report is still only a set of proposals. The guidelines are not binding for the members of the Council, which includes the EU, the G20 and most emerging economies.
The G7 took a much more direct tone last week. Probably also with a view to Facebook’s controversial currency project, the Group of Seven complained in a position paper that “no global stable coin project should be put into operation until it meets the relevant legal, regulatory and supervisory requirements”. The Group of Seven is naturally less critical of digital central bank currencies (CBDCs). This is probably also due to the currency experiments of its own members.
Decentralized is different – the CBDC ideal of central banks
The latest report by the Bank for International Settlements (BIS) sheds light on the form CBDCs should take in this context. In this report, central bankers describe, for example, what digital currencies would have to look like in order to maintain the common goal of financial market stability. One of the fundamental goals identified by the organization is that digital currencies should not compete with domestic money. In addition, the report prescribes a further 14 core characteristics that a digital national currency should fulfill. Also less attentive observers will become at the latest now clear that the national conceptions for crypto currencies with the Bitcoin vision of first hour still hardly something to do have.
OECD wants to develop international tax standards
While global stable coins and most CBCDs are at best just plans and ideas on the drawing board, the international community of states also wants to continue to steer the existing crypto-economy in an orderly direction. A report by the Organization for Economic Cooperation and Development (OECD) for the G20 now brings into play worldwide guidelines for a uniform tax regime for crypto-currencies. By next year, the organization intends to prepare these and present them to the international community.