This year, the G7 Finance Ministers will publish Common Rules for State-Issued Digital Currencies.
The G7 finance ministers and central bank governors met and decided to work toward a set of common principles for state-backed digital currencies, which they will publish this year. These digital currencies, they argued, “may operate as a liquid, secure settlement asset as well as an anchor for the payments system.”
The G7 has established a set of common rules for central bank digital currencies.
On June 4-5, the G7 finance ministers convened in London for the first time since the G20 financial leaders convened in Saudi Arabia in February last year. The meeting was held after the G7 finance ministers and central bank governors met virtually on May 28. The G7 consists of the United States, the United Kingdom, Japan, Germany, France, Italy, and Canada.
According to the G7 Finance Ministers and Central Bank Governors Communiqué released on Saturday, one of the subjects they covered was central bank digital currencies (CBDCs).
The communiqué adds, “Innovation in digital money and payments has the potential to deliver enormous advantages, but it also raises public policy and regulatory problems.”
“We commit to work together, as finance ministries and central banks, within our respective mandates, on their wider public policy implications,” the finance leaders said, noting that the G7 central banks “have been exploring the opportunities, challenges, as well as the monetary and financial stability implications of central bank digital currencies.” They went on to say:
As a kind of central bank money, CBDCs might serve as a liquid, secure settlement asset as well as an anchor for the payments system.
“Our goal is to make sure that CBDCs are based on long-standing public sector commitments to openness, the rule of law, and strong economic governance,” they said.
“CBDCs should be robust and energy-efficient; they should foster innovation, competition, and inclusiveness, and they may be able to improve cross-border payments; they should operate within proper privacy frameworks and minimize spillovers,” they continued, emphasizing:
We will work towards common principles and publish conclusions later in the year.
The G7 finance leaders included the leaders of the International Monetary Fund (IMF), World Bank Group, Organisation for Economic Cooperation and Development (OECD), Eurogroup, and Financial Stability Board (FSB).