Regulatory and policy gaps and inconsistencies
Since the inception of bitcoin in 2019, privately issued digital currencies have developed into a market with over $2.5 trillion market capitalization. During the same period, central banks from economies large and small are also actively looking into the design of central bank digital currencies. Despite the rapid development of digital currencies, laws and regulations are still playing a catchup game. Designing a coherent, global and innovation-friendly regulatory and policy framework for digital currencies is a challenging task given the complexity behind the technology, the reactive legislative process and lack of a comprehensive regulatory framework for a global financial system.
This white paper aims to help foster a regulatory and policy environment conducive to the development and adoption of digital currencies, while the laws and regulations on digital currencies are still being shaped. The product of public and private collaboration over a diverse spectrum of players in the ecosystem, it examines some existing rule-making approaches and points out areas where gaps and inconsistencies may arise.