World Economic Forum to Set Regulations with Newly Formed Consortium

The regulation of cryptocurrency has been awaited since its inception. When the World Economic Forum announced its plans to form a cross-border governance group, we got closer to our goal. The group’s mandate was to set global crypto standards.

The group is called the Global Consortium for Digital Currency Governance (GCDGS). It aims to find solutions that will unify the regulatory systems which, at present, are fragmented.

Unifying the Fragments
Industry players feel that there are too many complex regulations from multiple countries to abide by. Many of these regulations contradict one another. For instance, you may find one aspect of your business being viable in one country but unacceptable in another.

This becomes frustrating for businesses operating across internationally. Also, there are all kinds of legal issues that have stunted the growth of the cryptocurrency industry.

What is About to Change?
Over the past decade, some innovative global bodies have fronted discussions and ideas aimed at introducing global regulations on cryptocurrencies. Unfortunately, these ideas are couched in a language that conveys fear of the impact of cryptocurrencies on monetary supremacy.

Also, the language may seem to dismiss the potential power of cryptocurrencies. However, a transition has begun. The consortium, which is made up of key global financial gurus, believes cryptocurrencies can improve global financial inclusion.

They aim to make the financial system accessible by introducing innovative solutions. The experts believe that with proper regulation, opportunities for financial inclusion will be open to all markets.

The Team
  • Professor Klaus Schwab: A German economist and engineer; author and founder of the World Economic Forum (1971) and author of ‘The Fourth Industrial Revolution’ (2016). This book highlights the speedy technological growth we are experiencing now, more so than ever before.
  • Mark Carney: The outgoing Governor of the Bank of England.
  • Lesetja Kganyago: Head of Reserve Bank; South Africa
  • Patrick Ngugi Njoroge: Head of Reserve Bank; Kenya
  • David Marcus: Head of Facebook’s Calibra project and Libra Stablecoin
The swift ascent of stablecoins, such as Libra and Tether, has given leading economists a glimpse into the value of cryptocurrencies. These digital currencies appear to make it possible for previously unbanked people to join the global financial system.

The Transition
It has taken Schwab and the financial mainstream a while to recognize the market’s value with regard to Bitcoin and block chain technology. However, he now realizes that digital currency should be considered alongside other major technological advancements such as AI.

The agenda for the next WEF DGS meeting to take place in San Francisco (20th-21st April 2020) includes block chain technology in its summary. It opines that it is part of the technology that “could lift communities out of poverty, cure diseases and restore balance to our oceans and natural ecosystems.”

The recognition of cryptocurrency may be pegged on vast financial incentive even as its technological advantages are plain to see.

Shaping world policy is a slow process. It is unfortunate it has taken over a decade for global leaders to recognize the potential of digital currencies. However, it is great that finally, the potential for cryptocurrencies to change the world for the better is finally being acknowledged.

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