Japan will request a debate about global cryptocurrency regulation during the next summit of the G20 amid mounting alarm that the popular assets are being used by illegal groups for money laundering, a government official told Reuters Tuesday.
The upcoming G20 summit, which will host the biggest economies in the world, is scheduled to take place next month in Buenos Aires, Argentina.
That announcement could send more ripples through cryptocurrency markets, which wobbled last week amid concern over exchanges woes and regulatory warnings in the US.
Japanese officials say that due to its explosive growth, it makes sense to discuss the speculative risks of cryptocurrencies and their impact on the financial system at the international level.
Specifically, they call for world-wide restrictive measures that require crypto platforms to identify their users. Japan wants the new rules to allow international investigators more access to information, forcing cryptocurrency users and operators to disclose their identities and any suspicious activity.
Extending AML regulations to cryptocurrency activities is being considered in several countries around the world such as Australia and the UK, and already tracks the EU’s recent push to regulate Bitcoin. Poland has also said it would strengthen its laws by bringing Bitcoin providers under the government’s anti-money laundering and counter-terrorism financial legislation.
But the really big challenge is the absence of coherent direction on cryptocurrency regulation as each country has its own approach. Some countries are welcoming, including Japan itself, while others are cautious, such as the US and Europe. And some nations like China are downright antagonistic.
Reuters quoted one of the officials saying that “the prospects for the G20 finance leaders to agree on specific global rules and mention them in a joint communique are low.”
“The general feeling among the G20 members is that applying too stringent regulations won’t be good,” another official stated.
He added: “Discussions will focus on anti-money laundering steps and consumer protection, rather than how cryptocurrency trading could affect the banking system.”
The concerns over cryptocurrency mining, trading and usage to transfer money are already shared by several governments across the globe.