G20 will examine cryptocurrency regulations this week

On Monday, the OECD proposed a framework to the G20 designed to improve cryptocurrency transparency on a global scale.

When both the new framework and the revised standards are put into place, it may be the end of the “wild west” of cryptocurrencies and the global patchwork of regulations as we know it.

The Group of Twenty (G20) is an international forum for economic and financial cooperation among 20 member nations. The G20 asked the OECD to figure out a way to standardize the automatic exchange of cryptocurrency tax information by April 2021.

G20 Finance Ministers and Central Bank Governors will meet on Wednesday and Thursday in Washington, DC. They will talk about the 100-page Cryptoassets Reporting Framework (CARF) and proposed changes to the group’s Common Reporting Standard (CRS).

The CARF, which the OECD calls a “transparency project” for cryptocurrencies, was first authorized by the organization in August. It includes rules for trading cryptocurrency derivatives, definitions of “cryptoassets” and “NFTs,” a framework for automating international cryptocurrency tax reporting, and more.

The OECD has issued a statement saying that the CRS, which was created to deter international tax evasion, does not now apply to cryptocurrencies.

The OECD said that the “chance that they would be used for tax evasion, while undermining the gains gained in tax transparency via the implementation of the CRS,” is greater with cryptocurrencies outside the scope of the existing regulation.

The OECD has recommended modifying the CRS to include a new section on central bank digital currencies along with a description of what such currencies are (CBDCs).

Governments across the world are beginning to acknowledge the trillion-dollar potential of the cryptocurrency market, as well as the possibility that criminals could exploit the currency’s permissionless and, in some cases, pseudonymous features to launder money or commit other illegal acts.