Digital currency assets under discussion at G7: US Treasury

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Digital currencies and stablecoins have been the subject of discussion at a meeting of senior national officials, according to reports of a G7 meeting issued by the U.S. Treasury Department.

In developments that indicate the growing profile of digital currency assets at the highest levels of government, finance ministers and central bank governors from across the Group of 7 countries discussed crypto assets and their increasing role in the global financial system.

While discussions focused primarily on the coronavirus pandemic and the economic fallout from government mandated restrictions, a readout from U.S. Treasury Secretary Steve Mnuchin indicated that the ‘evolving landscape of crypto assets’ and digital currency regulation came for discussion.

According to a statement issued by the Treasury, discussions turned to how national authorities could implement regulation to prevent the illegal use of cryptocurrencies and other digital assets.

“They also discussed ongoing responses to the evolving landscape of crypto assets and other digital assets and national authorities’ work to prevent their use for malign purposes and illicit activities. There is strong support across the G7 on the need to regulate digital currencies.  Ministers and Governors reiterated support for the G7 joint statement on digital payments issued in October.”

Under Mnuchin and President Donald Trump, U.S. policy has been supportive of digital currency and other digital assets, with the Office of the Comptroller of the Currency in particular pioneering several key initiatives.

However, comments this week from senior Democrats have appeared to indicate a change in political direction, apparently more restrictive on how digital assets can be used, and should interact with the wider financial system.

While new regulation was already said to be in the works back in February 2020, according to Mnuchin, the installation of the new Presidential team is expected to bring more significant change to the Office of the Comptroller of the Currency, and the broader U.S. approach to digital currency regulation.

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