May 28, 2023

WEF Says Global Coordination Key in Crypto Asset Regulation

World Economic Forum

World Economic Forum

The World Economic Forum (WEF) asserted the importance of crypto regulation in the current period, highlighting the need for cooperation, Cointelegraph reported.

This came in a white paper released by the WEF in cooperation with its Digital Currency Governance Consortium. The WEF noted that global cooperation is essential for crypto asset regulation to avoid inconsistent enforcement, ambiguity, and regulatory arbitration.

The white paper addressed a set of challenges to crypto asset regulation, such as the presumption of the same activity and regulation. According to the paper, crypto-assets and their ecosystem do not always fit squarely into the existing activity-based, intermediary-focused approach of regulation, even where crypto-asset activities mirror those of the traditional financial sector.

The authors also highlighted that the crypto regulation faces a complicated issue which is the anonymity featured by crypto mixers, self-hosted wallets, and decentralized exchanges, warning of the increasing connection with traditional finance that boosts potential contagion risks from the crypto industry, which witnessed turmoil over the past period.

The paper gave recommendations for each of the crypto industry, regulatory authorities, and international organizations, asserting that sharing and coordination are the best practices.

“Policy-makers and industry stakeholders need to collaborate across jurisdictions to ensure consistency and clarity, the paper read, adding: “As these new technologies start from a position of transparency, it is possible to imagine even better regulatory tools to address cross-border concerns.”

Earlier in January, WEF collaborated with Accenture and Microsoft, to launch a purpose-driven metaverse, where organizations and companies around the world can convene to address and create solutions for the world’s top challenges with the participation of 80 pioneering organizations.

WEF’s Global Collaboration Village used the state-of-art capabilities of the metaverse to address and find solutions for the big issues in an open, inclusive, and sustained way.

Author profile

Whether you want to learn about NFT, Blockchain, Web3.0, Metaverse, or any other emerging technologies, we have the vital resources that will enlighten and help you make an informed decision.