The UN believes crypto could threaten the monetary sovereignty of developing nations, and it’s recommending strict rules to curtail their use.
A recently published policy brief from the United Nations recommended developing nations take action against crypto, warning of risks associated with leaving the industry unregulated.
The intergovernmental organization cautioned cryptocurrencies could threaten the financial stability of developing nations, enable illicit financial activity, prevent authorities from limiting the flow of capital, and also jeopardize the monetary sovereignty of nations by unofficially replacing domestic currencies.
The brief recommended governments “make the use of cryptocurrencies less attractive” by imposing taxes on transactions using the technology and requiring the mandatory registration of digital wallets and cryptocurrency exchanges. It also put forth the idea of banning financial institutions from holding digital assets and preventing them from offering crypto-related services to clients.
Developing nations should restrict or prohibit advertising from crypto companies in public places or on social media platforms, the conference proposed as well, claiming it’s an “urgent need in terms of consumer protection in countries with low levels of financial literacy” that could lead to “significant losses,” according to the policy brief.