Global financial regulators and the International Monetary Fund on Thursday set out a roadmap or framework to coordinate measures that stop crypto assets from undermining macroeconomic and financial stability.
Such risks are exacerbated by non-compliance with existing laws in some cases, the G20 risk committee, the Financial Stability Board, and the IMF said in a paper.
"Widespread use of crypto-assets can undermine the effectiveness of monetary policy, bypass capital flow management measures, exacerbate fiscal risks, divert available resources to finance the real economy, and threaten global financial stability," the report continued.
The paper sets a timetable for IMF and G20 members to implement the latest recommendations to regulate crypto assets from the Financial Stability Board and IOSCO, the global financial watchdog group said.
This marks a further development of regulatory thinking after several years of not seeing a major threat from the sector, with attitudes becoming tougher after the collapse of the FTX crypto exchange last November, which rocked the market and left investors with heavy losses.
"A comprehensive policy and regulatory action for crypto-assets is needed to address the risks of crypto-assets to macroeconomic and financial stability," states the paper, which will be presented to G20 leaders at a meeting in New Delhi this month.
The European Union has approved the world's first comprehensive set of rules for crypto-assets, but a disorganized approach still prevails elsewhere.
