Finance ministers from the Group of Seven (G-7) urged the Financial Stability Board (FSB) to accelerate crypto regulations following the downfall of the Terra blockchain and its terraUSD (UST) algorithmic stablecoin, Reuters reported.
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Fast facts
- The inter-governmental political forum — consisting of Canada, France, Germany, Italy, Japan, the U.K. and the U.S., with the European Union as a non-enumerated member — met in Koenigswinter, Germany, on Thursday and Friday.
- Terra’s collapse pulverized an estimated US$45 billion from the blockchain’s ecosystem, and it has driven the urgency for cryptocurrency regulation.
- During a May 10 Senate Hearing, U.S. Treasury Secretary Janet Yellen highlighted the risks stablecoins presented to the financial system and called for regulation.
- “A stablecoin known as TerraUSD experienced a run and had declined in value,” Yellen said. “I think that simply illustrates that this is a rapidly growing product and that there are risks to financial stability.”
- Despite the UST de-pegging fiasco, major stablecoins such as USDC, USDT and algorithmic stablecoin DAI are trading at US$1.
See related article: What’s the solution to Terra’s UST and LUNA crisis?
