The recent 2018 Buenos Aires G20 summit took place exactly ten years after the first G20 leaders’ summit that took place in Washington, DC when several heads of governments met to create a strategy to address the 2008 financial crisis. Since then, these summits have been taking place on an annual basis, and their focus has shifted given the extensive global economic change. This year’s summit put forth several agenda priorities for the G20 dialogue meeting, such as the future of work, infrastructure for development, and a sustainable food future. Despite this, a few unexpected occurrences took place during the G20 summit that weren’t planned for. For instance, the appearance of the Saudi Crown Prince, Mohamed bin Salman, at the summit caused some protests over the gruesome October murder of Saudi writer Jamal Khashoggi.

The French President, Emmanuel Macron, and British Prime Minister, Theresa May, called him out for this act but couldn’t get a good response out of the prince (not that they don’t have their own failings and things for people to protest over, but yes, having a writer killed, not good). Moreover, Russia’s President, Vladimir Putin, was confronted over the recent seizure of Ukrainian naval vessels and crews. However, the leader remained adamant that Russia’s actions were justified. The U.S. President, Donald Trump reiterated that Russia’s actions were the reason he canceled a planned meeting between him and Putin on the sidelines of the summit. However, during the summit, the U.S. President did agree not to impose additional trade tariffs on China for at least 90 days. This agreement was to give the two countries time to resolve their existing dispute.

G20’s Regulations and Tax Laws for Cryptocurrencies

Despite minor differences here and there, all G20 global leaders walked away from the summit in agreement that there was a need to create a global framework to tax cryptocurrency transactions. At the meeting, the members agreed that the global financial infrastructure was becoming increasingly digitized and there was a need to develop stronger measures to sustain finance. They all agreed to the creation of a resilient and open financial system that would follow international laws and support sustainable economic growth for all participants. It’s at this point that the issue of cryptocurrencies was brought up. The biggest problems were claimed to be fraud and money laundering. The leaders asserted that they were looking to imprint stronger regulatory tactics on both cryptocurrency and blockchain businesses.

The G20 agreed that they would regulate crypto-assets in line with FATF (Financial Action Task Force) standards. They went to the extent of signing and releasing a joint document to show that they agreed on finding a standard solution to the issue of crypto-taxation. According to the paper, the leaders revealed that they are intending to step up their endeavors to ensure that the benefits of technology in the financial industry are realized while the risks are mitigated. During that time, the summit also focused their attention on taxation, mentioning that they were working on a fair and sustainable global and modern international tax system.

According to an article published by a Japanese media outlet known as Jiji.com, national tax agencies are having difficulty in taxing companies doing cryptocurrency and blockchain related business in their states with offices overseas. For instance, if a company is conducting cryptocurrency business in Japan and doesn’t have an office in Japan, Japanese authorities cannot tax it. According to the report, leaders at the G20 summit are aware that people are aware and actively taking advantage of these tax loops. Therefore, the G20 agreed that there was a need to take action to close these tax loopholes. Japan is said to have advocated for the G20 to take a unified approach towards cryptocurrencies, pushing for the group to establish an internationally binding set of regulations.

It’s expected that since Japan will assume the presidency of the G20 summit next year, it will pursue international regulations during its term. Japan has already imposed comprehensive cryptocurrency legislation, and regulators are heavily considering making reforms to their existing cryptocurrency laws. Moreover, Japan considers cryptocurrency-related tax evasion a severe issue and therefore, it’s looking to punish offenders severely. This same intention was reiterated by India as it presented a list of points that urged members to combat “fugitive economic offenders.” India’s prime minister, Narendra Modi presented this list and discussed that it would be essential to have international cooperation for information sharing that would enable quick tracking of offenders.

Opinions Towards Global Crypto-Regulations and Tax Laws

A few leaders voiced their positive views towards the G20 summit decision to create global tax laws and regulations towards cryptocurrencies. For instance, Brent Jaciow, the head of blockchain affairs at Utopia Music, had a positive sentiment towards the onset of global cryptocurrency laws. According to Brent, the development of international standards to regulate cryptocurrencies was a necessity for the cryptocurrency market. He pointed out that without the existence of regulatory oversight or a crypto-taxation framework, large entities would not venture into the sector for fear of regulatory backlash. He explained that the potential hurdles brought about by regulation would be insignificant compared to the benefits brought about by mainstream adoption.

Robert Visinskis, the founder of the Mysterium Network, also voiced a positive remark towards the summit’s move towards global cryptocurrency regulation and taxation. He stated that it was exciting that the most powerful economies were finding it important to have international standards to regulate cryptocurrencies. He clarified that it would undoubtedly be a challenge given the different ways states have started to regulate crypto-assets. However, he pointed out that the G20’s taxation of crypto is an essential step towards building trust in blockchain and cryptocurrency projects.

ConclusionCryptocurrency regulation has been on the radar of several governments around the world. Moreover, with the cryptocurrency industry about to hit upwards of $1 trillion in valuation, most governments want to ensure that they get what they’re owed through taxes. The agreed creation of international cryptocurrency regulations and tax laws may represent a global movement that could fuel further adoption and approval of cryptocurrencies around the world (of course, it could also be one step closer to a dystopian global government). Get a head start on crypto-asset ownership by investing in our advanced and secure, multi-asset, Blockchains.my (BCMY) digital wallet app.