G20 is not expected to release new regulatory signals, Bitcoin price is safe

Finance ministers and central bank governors from major economies are trying to resolve some of their differences on the most pressing economic issues when they meet in Buenos Aires on Monday. When all is said and done, the Group of 20 will issue a statement in an attempt to reach a consensus.

Policymakers are struggling to develop a unified strategy to regulate digital currencies. The sharp rise in digital currency prices has challenged regulators, who are concerned that cryptocurrencies are being used by criminals for money laundering and tax evasion. A draft statement from the Group of 20 on Monday afternoon said cryptocurrencies lack many of the attributes of legal currencies.

Bank of Japan Governor Haruhiko Kuroda stressed consumer protection, and Saudi Arabian Monetary Authority Governor Ahmed Alkhahoi called for strategies to limit the impact of cryptocurrencies on market stability. On the same day, the Trump administration banned Americans from buying a cryptocurrency launched by the Venezuelan government.

The bitcoin market has always been crazy. The value of this cryptocurrency is like a roller coaster. After a crazy rise, it will fall wildly again. At the end of last month, bitcoin, which had already fallen to the bottom, was close to the $12,000 mark, and the increase in the past two weeks has almost doubled. According to CoinDesk data, the price of bitcoin rebounded to more than $8,000 after hitting a new low of $7,335.57 early Sunday. According to data from the trading platform BTCoin, as of 12:34 Beijing time, the trading price of bitcoin was $8,520.85.

Finance ministers and central bank officials from the world's 20 largest economies said on Tuesday that such "crypto assets" do not threaten financial stability but can be used to launder money or finance terrorism and harm consumers who buy them. However, no action is expected at the summit as policymakers have yet to agree on a common strategy to address the issue, including the United States, which sources said had developed a series of rules in the decade after the 2008-2009 financial crisis. This has boosted the prospect of unified global rules on the issue, which some regulators believe is needed to address issues that transcend borders. "The G20 is unlikely to call for new regulations," one of the sources said.

The G20 will hold two cryptocurrency discussions next week in a bid to seek a "common response" from delegates to regulation.

Here are some other key issues discussed at the G20:

Trade and tariffs

Trade is likely to be the most contentious issue, as the Trump administration is reluctant to accept multilateral agreements and pushes the U.S. to rebalance global trade. Many members of the G20 are unhappy with U.S. plans to impose tariffs on steel and aluminum imports. On Monday, several colleagues of U.S. Treasury Secretary Steven Mnuchin said the U.S. measures are threatening multilateral, rules-based trade. The European Union and Brazil have threatened to retaliate, while other countries such as Argentina and South Korea are lobbying for exemptions.

The United States stood firm, joining Canada in calling on Germany to maintain a major current account surplus. On the eve of the meeting, the United States also took aim at China, with David Malpass, a senior Treasury official, accusing Beijing of abandoning free-market capitalism.

Monetary Policy

Although new Fed Chairman Jerome Powell did not attend the meeting, his upcoming rate-setting meeting has also raised concerns as global policymakers brace for the impact of higher U.S. borrowing costs. Investors widely expect Powell to raise interest rates during his first meeting on Tuesday and Wednesday.

He may need to speed up the pace of tightening this year as fiscal stimulus and faster global growth provide a boost to the U.S. economy. According to a draft statement, "monetary policy will continue to support economic activity" as mentioned in last year's G20 communique, which also highlighted the risks of rising interest rates.

Internet company taxation

Taxation was also a contentious topic at the G20, with the European Union considering a tax on internet companies such as Amazon.com Inc. that have a sizable presence in the U.S. Mnuchin said last week that the administration was "firmly opposed" to the measure. But the EU has not given up on the idea, and one official at the meeting said it has become a major sticking point for the G20.