The Financial Stability Board (FSB) is a group that is working on proposing recommendations to the G20 in order to develop the global economy effectively and has developed a framework for monitoring cryptocurrency assets, reported Coindesk on July 16.
The FSB is working in collaboration with the Committee on Payments and Market Infrastructures (CPMI), the International Organization of Securities Commissions (IOSCO) and the Basel Committee on Banking Supervision (BCBS) to “help identify and mitigate risks to consumer and investor protection, market integrity, and potentially to financial stability.”
The group is working on many different metrics in order to help the cryptocurrency market grow in a secure and regulated way, as it explains in the regulated framework that was published on Monday.
“The objective of the framework is to identify any emerging financial stability concerns in a timely manner. To this end, it includes risk metrics that are most likely to highlight such risks, using data from public sources where available. Supervisory data pertaining to crypto-assets are potentially more reliable and could complement data from public sources.”
The FSB will be focusing on the price’s volatility, the various applications of cryptocurrency assets in the financial system, the growth of initial coin offerings (ICOs) and it will compare other systems such as equities and gold to cryptocurrency market’s volatility.
The working group believes that cryptocurrency assets are not a threat to the global economy but still need to be supervised.
“The FSB agreed that crypto-assets do not pose a material risk to global financial
stability at this time, but supported vigilant monitoring in light of the speed of developments and data gaps.”