Gains In G20 Negotiations On MDB Reform And Crypto Regulation

G20 Summit will chart new path in human-centric, inclusive development

A roadmap to regulate cryptocurrency, as well as a plan to reform multilateral development banks, is set to feature prominently at the G20 Summit, with leaders expected to provide guidance on future course of action, a senior government source said.

The finance track deputies are gathering to reach an agreement on matters where 10 resolutions were endorsed at the end of the third meeting of G20 FMs and central bank governors in Gandhinagar in July, while 17 were welcomed. Since then, there has been development in various areas, including funding for tomorrow’s cities and climate change and energy transition.

Some of the concerns expressed by countries such as Saudi Arabia about a just transition away from an oil-led approach have been taken into account while developing a framework for assessing the macroeconomic impact of climate change and their transition strategy.

At the same time, controlling debt risks has so far proven to be a subject on which no consensus has been achieved due to China’s unwillingness.

However, Indian policymakers stated that under its presidency, the government was able to highlight the subject publicly, with at least three nations’ loan concerns – Ghana, Ethiopia, and Zambia – addressed through the common framework, while Sri Lanka’s troubles were settled outside of the framework.

The synthesis document published by the IMF and the Financial Stability Board, which gives a detailed roadmap and the building blocks to govern crypto assets, is one of the problems before the deputies. Initially, there was skepticism about the G20 taking up the matter, but as events unfolded – including the collapse of several exchanges and the decline in bitcoin value – there is now a growing understanding among governments to regulate.

Given the broad use of technology, India has long maintained that one government or a collection of countries cannot regulate crypto assets, while also emphasizing the need to address macroeconomic and security concerns.

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Spriha Rai