HomeBusinessG7 finance officials back principles for central bank digital currencies By Reuters

G7 finance officials back principles for central bank digital currencies By Reuters


© Reuters. A representation of the virtual cryptocurrency Bitcoin is seen in this photo illustration taken on June 14, 2021. REUTERS / Edgar Su / Illustration

By Andrea Shalal and David Lawder

WASHINGTON (Reuters) – G7 finance officials on Wednesday endorsed public policy principles for retail central bank digital currencies, saying they should be based on transparency, the rule of law and strong economic governance, the department said. of the Treasury.

“Innovation in digital money and payments has the potential to bring significant benefits, but it also raises considerable regulatory and public policy problems,” the Group of Seven finance ministers and central bankers said in a joint statement.

“Strong international coordination and cooperation on these issues helps ensure that public and private sector innovation delivers domestic and cross-border benefits while being safe for users and the financial system in general.”

Finance officials met in person, and some joined by video, in Washington on Wednesday during the annual meetings of the International Monetary Fund and the World Bank under the leadership of British Finance Minister Rishi Sunak.

In their joint statement, G7 officials said central bank money in the form of central bank digital currencies, or CBDC, would complement cash and could act as a safe and liquid settlement asset and an anchor for the payments system. .

They said the principles were intended to support design and policy deliberations inside and outside the G7, complementing recently published work by a group of central banks and the Bank for International Settlements.

No G7 authority has decided to issue a CBDC, and careful consideration of possible political implications will continue, according to the statement.

“We reaffirm that any CBDC must build on our long-standing public commitments to transparency, the rule of law and strong economic governance,” the statement said. “Any CBDC must support and ‘not harm’ the ability of central banks to fulfill their mandates of monetary and financial stability.”

G7 officials emphasized the importance of rigorous privacy standards, cybersecurity, the need to protect user data, and transparency about how information will be protected and used.

They said such currencies must be energy efficient and operate in an open, transparent and competitive environment, while underscoring the importance of interoperability at the cross-border level and the need to minimize any harmful spillovers to the international monetary and financial system.

They reiterated that no global stablecoin project should begin operating until it addresses legal, regulatory and supervisory requirements, echoing a similar statement made by finance officials from the largest Group of 20 on Wednesday.

Stable currencies are a type of digital currency linked to traditional currencies.

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