The IMF has released a new policy paper, ‘Elements of Effective Policies for Crypto Assets’ to address queries surrounding how to respond to the rise of crypto assets and associated risks.
The report outlines nine core elements that can help members develop a comprehensive, consistent and coordinated policy framework to better mitigate the risks posed by crypto assets while also harnessing the potential benefits of the technological innovation associated with it:
- Safeguard monetary sovereignty and stability;
- Guard against effective capital flow volatility;
- Analyse and disclose fiscal risks and adopt unambiguous tax treatment of crypto assets;
- Establish legal certainty of crypto assets;
- Develop and enforce prudential, conduct, and oversight requirements to all crypto market actors;
- Establish a joint monitoring framework across domestic agencies and authorities;
- Establish international collaborative arrangements to enhance supervision and enforcement of crypto asset regulations;
- Monitor the impact of crypto assets on the stability of the international monetary system;
- Strengthen global cooperation to develop digital infrastructures and alternative solutions for cross-border payments and finance
Firms operating within the sector should read the report to gain further insights into the potential shape of international regulatory standards relating to crypto assets.