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Seminar on Digital Assets: Cryptoassets, Stable Currencies and Emerging Prudential Treatment

September 25 - 26, 2024
Videoconference

CEMLA's Directorate of Financial Market Infrastructures, with support from the Financial Stability Institute (FSI) of the Bank for International Settlements (BIS), organized the Seminar on Seminar on Digital Assets: Cryptoassets, Stable Currencies and Emerging Prudential Treatment. Held virtually from September 25 to 26, 2024, the event brought together 104 representatives from 30 institutions and CEMLA associates. The seminar focused on regulatory approaches to digital assets, particularly stablecoins, underscoring their growing significance in financial systems.

On the first day, Pedro Henrique (Banco Central do Brasil) discussed new laws concerning the regulation and supervision of digital assets. He emphasized the increasing adoption of crypto assets, noting that stablecoins have become the most widely used crypto asset over the past three years. Following his presentation, Olga Bespalova (IMF) identified inflation, high transaction costs (especially for remittances), and speculation as the main drivers of crypto asset adoption. She reviewed regulatory approaches across Latin America, highlighting permissive policies in El Salvador, more moderate stances in Mexico, Chile, and The Bahamas, and restrictive measures in Ecuador, the Dominican Republic, Colombia, and Bolivia. Bespalova suggested that addressing the underlying drivers of crypto adoption may be more effective than outright prohibitions.

On the second day, Denise García Ocampo (FSI, BIS) provided a historical overview of the rise of stablecoins in 2014 as a tool to limit volatility in digital assets. She outlined various classifications of stablecoins and discussed how differences in definitions, reserve requirements, and claims held by stablecoin holders complicate cross-border operations. Although financial stability risks remain contained for now, García Ocampo emphasized the importance of joint public and private sector initiatives to support effective regulation. Elisabeth Wallace, from the Dubai Financial Services Authority (DFSA), also addressed the evolution of stablecoin regulation, referring to them as "fiat crypto-tokens" and highlighting how regulatory criteria have shifted from cash reserve requirements to higher-quality reserves.

Finally, Elisabeth Noble, from the European Banking Authority (EBA), introduced the MiCAR (Markets in Crypto-Assets Regulation) framework, which governs issuers and crypto-asset service providers in the European Union. Under MiCAR, stablecoins are categorized as Electronic Money Tokens (EMTs), Asset-Referenced Tokens (ARTs), and other residual crypto assets. MiCAR came into force in June 2024, with seven EMTs currently operating under its guidelines and no ARTs yet registered. Noble also emphasized strong coordination among national authorities for MiCAR’s implementation, highlighting its role in creating a unified regulatory framework across the region.

Activities