Helping emerging nations create their own central bank digital currencies (CBDCs) will be among the topics on the agenda of the G7 group of leading wealthy countries when it meets this year to address the world’s rapidly expanding digital economy.
“We have to address risks from the development of CBDCs by ensuring factors such as appropriate transparency and sound governance,” Masato Kanda, Japan’s vice finance minister for international affairs, told a 10 April seminar in Washington.
Japan is hosting this year’s G7 summit.
“As a priority this year, the G7 will consider how best to help developing countries introduce CBDCs consistent with appropriate standards, including the G7 public policy principle for retail CBDCs,” he said.
The G7 has set common standards for CBDCs but the group is still developing strategies to address digital security, geopolitical divisions, and the risk that CBDCs could destabilize financial markets, Kanda added..
Almost every advanced nation is designing or experimenting with its own CBDC. China issued its digital renminbi for public use in 2021.
Last year’s collapse of FTX, one of the world’s largest crypto exchanges, “was a serious wake-up call” for nations to create common policies, Kanda said.
“For crypto assets, there are diverging views among countries, but consensus is definitely that we need more regulation, particularly after the FTX shock,” he noted.
G7 members include Canada, France, Germany, Italy, Japan, the U.K., and U.S. The European Union also participates.
TRENDPOST: The Trends Journal has noted and predicted that there are incentives for weak currency nations to turn to cryptos. The move by G7 members, with relatively strong currencies, to entice developing countries to turn instead to CBDCs that can be controlled by entrenched financial powers, should come as no surprise. See “CBDC OUT TO PRESERVE STATUS QUO FOR HAVE AND HAVE NOT COUNTRIES, SAYS NEW STUDY” (24 May 2022) and “CRYPTO FLOWING TO DEVELOPING REGIONS” (24 Jan 2023).
The FTX debacle was not born of failures of crypt technology, but of more mundane human corruption that Biden administration regulators conveniently missed as Sam Bankman-Fried funneled money to Democrat coffers during the 2022 election cycle.