▲ Promote the soundness of global stablecoins
Recently, with the G7 as the center, consensus is forming that legal issues must be resolved in order to realize the potential benefits of stablecoins in the international community.
According to the report of’Main Contents and Implications of the G20’International Payment Service Improvement Program” published in March by the Bank of Korea Financial Settlement Bureau, in April 2020, DM Libra Association launched a system linked to each currency of major countries instead of launching a single global currency. It was decided to issue a table coin (e.g. LibraUSD).
The report diagnosed that the need for coordination of regulatory measures in each country through cooperation is increasing in order to proactively respond to the effects of the commercialization of stablecoins on the stability of currencies and financial systems in each country, and the protection of users’ personal information.
“Therefore, international organizations such as BIS decided to discuss ways to establish a harmonious surveillance and supervision system between countries in preparation for the possibility of using the global stablecoin as a means of payment between countries,” he said.
Establishing clear governance requirements for global stablecoins, preparing legal and operational risk management measures to prevent money laundering (AML) and terrorist financing (CFT), and discussing measures to prevent regulatory gains due to regulatory differences between countries I am going to do it.
However, as a forward-looking improvement plan that assumes that the use of stable coins will be activated in the future, BIS CPMI stated that there is no plan to preemptively promote the development of stable coins.
▲ When designing CBDC, consider the aspect of improving payment service between countries
While the digital economy is spreading in major countries and the demand for cash is decreasing, some central banks are promoting the possibility of improving the payment and settlement sector through digital currency issuance.
As the expectation that the central bank digital currency (CBDC) could contribute to improving the efficiency of the cross-border payment process spreads, BIS adopted a study on how to use CBDC’s cross-border payment service as a long-term review project.
In order to proactively respond to changes in the internal and external payment environment, the Bank of Korea will preemptively review the technical and legal requirements of the introduction of CBDC, while building and testing the CBDC pilot system in a virtual environment in 2021. In order to closely monitor changes in external conditions related to CBDC and share research results of major countries, it plans to strengthen information exchange and cooperation between central banks.
The Bank of Korea said, “We will participate in all six workstreams initiated by international organizations to promote inter-border payment service projects to represent our position and actively share related contents.” The six business promotions include ① payment and settlement connection, ② foreign exchange simultaneous payment, ③ expansion of payment and settlement system participation and extension of operating hours, ④ liquidity supply, ⑤ communication message and API standardization, and ⑥ future of payment and settlement.
FINTECHPOST
Author/ Translator: Jamie Kim
Bio: Jamie Kim is a technology journalist. Raised in Hong Kong and always vocal at heart. She aims to share her expertise with the readers at blockreview.net. Kim is a Bitcoin maximalist who believes with unwavering conviction that Bitcoin is the only cryptocurrency – in fact, currency – worth caring about.