The Banking Executive Magazine - March 2023 Issue

G20 2023 nomic implications and widespread crypto adoption in the economy, highlighting the need for a data- based and informed approach to the global challenges and opportunities of crypto assets The International Monetary Fund (IMF) revealed the consequences of crypto adoption on the internal and external stability of a country’s econ- omy as well as on the structure of its financial system. It highlighted the benefits of crypto assets including cheaper and faster cross border pay- ments, more integrated financial markets, and increased financial in- clusion, but these are yet to be re- alised. The Indian G20 Presidency and the IMF addressed the challenge of the global information gaps pertaining to the crypto asset universe and the need to build a deeper understand- ing of the interlinkages, opportunities and risks pertaining to crypto assets. The following key issues were high- lighted: • The need for a common taxonomy and a systematic classification of the crypto asset universe. • Identification of benefits and risks of crypto assets. • Development of macroeconomic policies for crypto assets. • Ensuring financial stability and ad- equacy of regulatory responses. • Resolving the issue of the highly centralised nature of the crypto universe despite the claim that it is a decentralised platform. • The costs and benefits that crypto assets create for the real economy. • The need to establish clear regula- tory perimeters for new financial technology (FinTech) innovations. • The lack of governance structures in the crypto universe. • The need to look at alternate solu- tions to address existing challenges in global financial and payment systems. • The consequences of crypto assets on the broader economy. • The role of crypto assets is the op- timal solution for existing chal- lenges in global financial systems. ALIGNING ARAB BANKS STRATEGIES WITH G20 PRESIDENCY PRIORITIES In light of the growing role of the G20 presidency and its priorities that are shaping world economies, Arab banks and authorities are recom- mended to align their future strate- gies with the following important priorities set under G20 presidencies: • Developing the digital economy. • Developing the digital public infra- structure. • Developing the cities of tomorrow. • Regulating digital assets and capi- tal flows. • Developing a common framework in facing crisis. • Addressing climate change • Supporting the decarbonisation of the economy. • Protecting vulnerable people. • Global governance. • Climate financing. the BANKING EXECUTIVE 20 ISSUE 171 MARCH 2023