Leaders from the world’s 20 largest economies, collectively known as the G20, have called for the rapid implementation of a cross-border framework for crypto assets. During a two-day summit held in New Delhi, G20 leaders signed a consensus declaration urging the adoption of the Crypto-Asset Reporting Framework (CARF) and amendments to the Common Reporting Standard (CRS) to facilitate information exchange between countries, with implementation set to begin in 2027.
The CARF, introduced by the Organization for Economic Cooperation and Development (OECD) in October 2022, is aimed at providing tax authorities with enhanced visibility into cryptocurrency transactions and the individuals involved in them. Under this framework, participating countries would automatically share information on crypto transactions across borders on an annual basis. This would encompass transactions occurring on unregulated crypto exchanges and wallet providers.
Several prominent countries, including Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United Kingdom, and the United States, along with the European Union, would be directly impacted by the forthcoming framework. Collectively, these nations account for two-thirds of the global population, emphasizing the framework’s global significance.
In recent months, many countries have already begun implementing stricter disclosure standards for cryptocurrency transactions. In May, the European Union adopted updated regulations aligned with CARF, mandating the sharing of beneficiary names, distributed ledger addresses, and account numbers in digital asset transfers among European governments for tax purposes.
Furthermore, the G20 leaders endorsed recommendations from the Financial Stability Board regarding the regulation, supervision, and oversight of crypto assets and global stablecoins. These recommendations, published in July, establish standards for stablecoins that are akin to those applied to traditional commercial banks. They also encourage regulators to prevent activities that obstruct the identification of parties involved in cryptocurrency transactions, among other provisions.
The push for a coordinated and transparent approach to crypto asset regulation comes in the wake of growing concerns about money laundering, tax evasion, and financial instability in the cryptocurrency market. The G20 leaders’ call for swift action reflects their commitment to addressing these challenges on a global scale and ensuring the responsible use of cryptocurrencies in the evolving financial landscape. The timeline for implementation and the specific details of the CARF will be further clarified by the Global Forum on Transparency and Exchange of Information for Tax Purposes in the coming years.
