The thirteenth summit of the G20 nations, an international forum that brings together the world’s leading economies, wants to have a global framework for cryptocurrency taxation ratified by 2020.
According to the G20 Leaders’ declaration building consensus for fair and sustainable development:
“We will regulate crypto-assets for anti-money laundering and countering the financing of terrorism in line with FATF standards and we will consider other responses as needed.”
The Buenos Aires conference saw world leaders seek to find consensus on and formulate a way forward on several issues. Chief among them were climate change, food security plans to revitalize the World Trade Center and the Ukrainian crisis.
The conference also made a few other headlines, with the U.S president Donald Trump taking center stage.
Although the world leaders had a lot on their hands over the weekend, there was still enough time for them to look at cryptocurrency, with taxation and regulatory oversight top of the agenda.
According to a news report cited by Japanese outlet Jiji, the G20 nations have called for taxation of cryptocurrencies as well as the formulation of regulations for the crypto industry aimed at combating money laundering.
The topic of cryptocurrency regulation is on the agenda of many world governments, and the Buenos Aires conference has set the ball rolling on one of the issues that continues to bother the industry.
The summit came up with a draft document outlining development and implementation of a taxation system for cross-border payment services. The decision to have a tax system for crypto assets was also included in the final document of the summit’s deliberation, with all G20 leaders upending their signature.
A timescale for the taxation system proposes that member states submit their considerations and work on a draft document stipulating tax measures. These regulations will be discussed at the fourteenth G20 summit to be held on 28–29 June 2019 in Osaka Japan.
A final document containing the G20 regulations for taxation of cryptocurrencies should be ready ahead of the fifteenth meeting in 2020, as per the Financial Action Task Force (FATF) standards.
Development of international taxation standards for cryptocurrencies is an important step that can help the crypto market evolve and attract more investors.
The lack of a defined international taxation system for the industry has, in a way, been the reason large institutional investor companies and other entities have been shying away for fear that they could face a regulatory backlash.
In October, the CEO of Circle, a U.S payment technology provider called for the G20 to “normalize” crypto regulations. Earlier, Bruno Le Maire, France’s Minister of Finance reiterated the importance of the G20 to hold a constructive discussion on cryptocurrencies.
The G20 forms a big part of the global economy, controlling a large part of its financial and trade relations. Combined, the twenty nations’ population makes up two-thirds of the global total, represents 85 percent of the world’s gross product, and control 75 percent of international trade.
The cryptocurrency market has had a tough 2018, with prices for most of the coins declining to new lows after peaking at the end of last year. Bitcoin is trading just above $4,000, down from a high of $20k in December 2017.
However, with a number of products, including Bitcoin (BTC) futures contracts already seeing increased interest, and exchange-traded funds (ETFs) expected somewhere down the line, a change in fortunes for market players is all possible.