In its planned regulatory framework, the Financial Stability Board seeks to treat businesses that provide bitcoin services in the same manner as banks.
The FSB, the biggest financial watchdog in the world, intends to release regulatory standards for cryptocurrencies in 2023.
The Financial Times reports that the FSB plans to provide global regulators with a schedule in the upcoming months. They will be able to put its first suggestions for international crypto legislation into practise, it continued.
The action is a part of a stepped-up effort to regulate and limit cryptocurrency activity in the wake of a year of high-profile corporate disasters. The majority of politicians, however, are unable to understand that the people in charge of these centralised lending organisations are to blame and not cryptocurrency.
Regulating Crypto as Banks
Dietrich Domanski, the FSB’s secretary general, stated to the Financial Times that the regulator was looking for a clear path forward for the cryptocurrency industry. He continued, allaying worries that they would crush the developing banking industry.
“Many participants in the cryptocurrency business claim that the government is anti-innovation. Authorities have, I would think, thus far been fairly flexible. Recent occurrences have strengthened the understanding that it is indeed necessary to address hazards.
He said, however, that the goal would be to regulate cryptocurrency service providers in a manner comparable to that of banks “provided they provide the same service that banks give.”
According to Domanski, these regulations would have prevented the Terra and FTX disasters because neither would have adhered to “the conditions for sound government.”
To put it another way, the FSB appears to want to outlaw any cryptocurrency businesses that do not satisfy the requirements for a banking license, which is almost everyone.
After the financial crisis of 2008—which was brought on by banks—the FSB instituted a global policy requiring banks to raise billions of dollars and put in place stricter risk management systems.
Financial Freedom’s Demise
With their growing demands from clients for personal and financial data, banks have destroyed financial freedom over time.
The remaining 99% of the population’s lives are miserable because of a small number of terrorists and money launderers. Regular banking is quite constrained, requiring a tonne of extra paperwork, KYC checks to open accounts, hefty fees, sluggish transactions, restrictions on how much money can be moved, and documentation of funding or capital sources.
Banks penalise their clients, presuming they are guilty until proven innocent. This is the reason why crypto was developed, but it seems that the establishment just wants to convert it into traditional money, complete with all of its problems.