IMF

On December 10, the International Monetary Fund (IMF) issued a statement on the need to develop a global framework of rules for the regulation of cryptoassets, especially by the Financial Stability Board, in order to avoid risks that could compromise financial stability and market behavior. From the organization, they said that they are looking for a comprehensive regulation that can be applied in different jurisdictions, reducing arbitrary regulations. On the other hand, they published a new report on the protection of electronic money where they establish recommendations to regulate and protect consumers’ funds.

Regulation of cryptoassets

The organization stated that there is a need to develop international standards that address the risks to the financial system arising from cryptoassets, their ecosystems and related transactions, and also create an environment for useful virtual asset products and applications. In that sense, it suggests that these new services and products for payments be subject to requirements similar to those for bank deposits, under the supervision of the central bank or payment supervisory entity.

Likewise, the development of a comprehensive regulatory framework responds to the cross-border nature of cryptoassets, since in addition to the limits of national approaches, each country is adopting different strategies that do not contemplate all aspects of this issue. In this way, international coordination will facilitate the tasks of supervision and verification of measures, avoiding destabilizing capital flows.

IMF recommendations on electronic money

Regarding the organization’s study on the supervision and protection of electronic money users, it recommends that all electronic money issuers (EMIs) be subject to regulatory requirements, including: standards for the supervision of the payment system that guarantee security; the legal, operational governance and ownership structure; fraud prevention, data security and cybersecurity, among others.

In that sense, it indicates that one of the most important regulatory measures is that all electronic money issuers must implement mechanisms to question and separate user funds. To this end, they must maintain a secure reserve of these liquid funds, equivalent to the balances of consumers, and separate from the issuer’s funds.