Regulatory attention on stablecoins comes as more governments move to launch their own central bank digital currencies
Finance chiefs from the world’s 20 largest economies have called for clearer oversight of the stablecoin sector as part of a broader regulatory framework.
The fourth G20 meeting of finance ministers and central bank governors was held in Italy this week. Participants agreed on a number of measures for how authorities should approach the issuance of stablecoins, stressing that appropriate regulation is essential—especially as several countries are now developing their own central bank digital currencies (CBDCs).
Leaders at the G20 meeting said the stablecoin sector should be subject to specific legal and regulatory requirements before stablecoins are approved for widespread use.
“We will make it clear that no so-called ‘global stablecoins’ should be allowed to proceed until all relevant legal and regulatory requirements are adequately met in terms of design and compliance with applicable standards,” the group said in a report.
The G20 report recognizes progress made in transforming cross-border payments and emphasizes that global economies rely on a “well-functioning digital infrastructure.”
However, policymakers agreed more work is needed to address challenges associated with stablecoin use, including transparency, costs, and transaction speeds. They also raised concerns about security and noted that the sector could affect the broader international monetary system.
According to the report, aligning regulatory approaches and adopting supervisory standards will allow many jurisdictions to follow the same roadmap developed under the Financial Stability Board (FSB). Established in 2009, the FSB’s mandate is to monitor the global financial system and pursue coordinated regulation, supervision, and oversight of the sector through 2027.
For now, both the United States and the United Kingdom—two leading nations in the digital asset space—have already begun targeting the stablecoin market while exploring the development of their own CBDCs. China appears to be further ahead in that race: its CBDC, the digital yuan, is already being rolled out after the country imposed a series of bans on crypto-related activities such as trading and mining.