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Representatives of regulatory agencies from both the United States and the European Union met at the forum for general financial regulation on March 24 and 25. They discussed the coronavirus-related regenerative stimulus, financial sustainability, and most importantly the mention of stablecoins and central bank digital currencies (CBDCs).
US participants in the forum included officials from the US Treasury Department and employees from independent regulatory agencies, including the SEC. On the EU side are representatives of the European Commission, the European Central Bank (ECB) and other regulatory bodies.
Overall, six topics were developed during the two days of the meeting. Mainly focused on the urgent issue of restoring COVID-19 and minimizing the associated financial stability risk. In addition, the new US administration emphasizes climate change as a potential financial risk. Multilateral participation in banking cooperation and capital market management is also mentioned.
Notably, cryptocurrencies emerged, as the asset played an increasingly important role in the financial markets. Officials have also exchanged views on recent developments and regulatory proposals regarding new forms of digital payments, including crypto assets, namely stablecoins and CBDCs. This is emphasized in the context of anti-money laundering and terrorism financing.
The Boston branch of the Federal Reserve (Fed) conducted research and cooperated with the Massachusetts Institute of Technology (MIT) to issue a digital dollar. Meanwhile, US Treasury Secretary Janet Yellen said such a project could help Americans improve their access to the banking system.
EU countries all announced that they will test CBDCs by the end of 2021. Bitcoin ETFs are very likely to be approved by the SEC in 2021. The Fed meeting has just ended all bring positive signs, even Chairman Powell said that Bitcoin could “substitute for gold rather than for the dollar”. Perhaps, the bottleneck for the entire crypto market will be unleashed after a period of tough struggles and persistence.
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