G7 to discuss cryptocurrency regulation after Terra (LUNA) collapse, says French central banker
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The demise of the Terra (LUNA) project and the collapse of the TerraUSD (UST) stablecoin caught the attention of the entire market. In addition, authorities in several countries around the world were on alert with the case.
In light of this, the G7 finance chiefs will discuss cryptocurrency regulation at a meeting in Germany.
The information was given by the president of the French central bank, François Villeroy de Galhau, on Tuesday (17), as reported by Reuters.
According to him, the fiasco of the Terra network and the recent fall in the cryptocurrency market should serve as a “red flag” for the implementation of rules in the sector.
“What has happened in the recent past is a wake-up call to the urgent need for global regulation,” Villeroy told an emerging markets conference in Paris. He referred to the recent turmoil in the crypto markets.
Cryptocurrency regulation in Europe
According to Villeroy, Europe has already paved the way for regulation through “Markets in Crypto-assets – MiCA”. This is a regulatory framework for crypto assets.
In this sense, the main economies in the world (Canada, France, Germany, Italy, Japan, the United Kingdom, the USA and the European Union) should discuss this agenda at the meeting that starts this Wednesday (18) and runs until May 20. .
The meeting’s work is being led by German Finance Minister Christian Lindner and Deutsche Bundesbank President Joachim Nagel. They will address current issues and challenges in the area of financial policy, in addition to the regulation of digital assets:
“We will likely discuss these issues among many others at the G7 meeting in Germany this week,” added Villeroy.
The MiCA is a proposed regulation that focuses on digital assets and their application in the global financial system.
Earlier this year, after a debate on environmental issues involving BTC, the EU backed off and stated that the MiCA bill does not include a ban on Proof of Work (PoW) based cryptocurrencies such as BTC.
This is not, however, the first time that Villeroy has called for the implementation of rules in the crypto market. After all, in 2021 he warned that the absence of regulation could jeopardize Europe’s monetary sovereignty:
“Whether digital currencies or payments, we in Europe must be ready to act as quickly as necessary. Or else, we run the risk of an erosion of our monetary sovereignty. I must stress here the urgency. We don’t have much time left, one or two years,” he said at the time.
