Philosophy

July 19, 2022


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Gradually, then Suddenly

July 19, 2022


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Long Memories

July 07, 2022


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Changing Tides

July 05, 2022


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digital
daily

digital daily: G7 Communiqué

G7 Communiqué. Digitalization received its own separate category in the latest G7 communiqué, the consensus statement of central bankers and finance ministers. The emphasis is not especially new. Meredith Williams notes that from 1975 to 2019, the annual G7 summit dedicated an average of 6% of its communiqués to digitalization, linked to information and communications technologies. The G7 inked a record 22% of its words to this area in 2000, mirroring the hype in financial markets. Now, digital assets are a focal point of the category. The G7 urged the Financial Stability Board to “advance the swift development and implementation of consistent and comprehensive regulation of crypto-asset issuers and service providers, with a view to hold crypto-assets, including stablecoins, to the same standards as the rest of the financial system.” The language on the implications is unusually direct, forceful: “no global stablecoin project should begin operation until it adequately addresses relevant legal, regulatory and oversight requirements.” Sometimes it takes spectacular “failure” for tremendous innovation to advance (e.g., SpaceX Starship explosions). The G7 statement reinforces that policy sees digital innovations are here to stay. Bringing stablecoin into the regulatory mainstream is a priority, and Terra-Luna is acting as an accelerator to regulatory clarity. The FSB has a high-level plan already, and international guidelines will come in July. The risk to digital asset markets? Oversteering.

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