G20 leaders have agreed to give global tax authorities greater visibility into cryptocurrency transactions, a sign of emerging international cooperation in the cryptocurrency space — even if it takes years.
Cryptocurrency rules will be included in a wide-ranging announcement backed by leaders at the G20 summit in India this weekend, although as investors have grown accustomed to it, it could be four years before the relevant tax reforms take effect. Cryptocurrencies take effect. However, a consensus on global traceability of cryptocurrencies could finally end the time when cryptocurrencies were used for tax evasion.
“We continue to closely monitor the risks of the rapid development of the crypto-asset ecosystem,” the G20 said in a statement supporting the Financial Stability Board’s recent high-level recommendations on regulation, oversight and supervision of cryptocurrency and stablecoin markets. .
Recommendations issued by the Financial Stability Board, the G20 body that oversees the financial system, in July included cryptocurrency platforms segregating customer funds, business functions to avoid conflicts of interest, and regulation of stablecoin issuers such as banks.
The G20 statement called for the rapid implementation of measures proposed by the Organization for Economic Cooperation and Development last year. This includes the Crypto Asset Reporting Framework, or CARF, which includes measures for global tax authorities to share information about cryptocurrency transactions between exchanges and wallets in order to have more comprehensive tax coverage for digital assets.
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The G20 commissioned the Global Forum on Transparency and Exchange of Information for Tax Purposes to “determine an appropriate and coordinated timetable for the launch of exchanges,” citing the need to launch CARF cryptocurrency tax exchanges by 2027.
While global cryptocurrency rules remain vague and slow to take shape, the G20’s ability to reach consensus on frameworks is an encouraging sign that regulatory progress can be made. While the European Union passed sweeping new regulations on cryptocurrencies earlier this year, progress remains slow in the United States, where Congress appears unlikely to pass legislation on cryptocurrencies this year.
Write to Jack Denton at [email protected] Title
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