India UK discuss developments around crypto assets, stress on robust global approach to deal with risk

India and the UK on Wednesday discussed international developments regarding crypto assets and emphasised the importance of robust global approaches to deal with risks attached to this.

At the India-UK 2nd Financial Markets Dialogue participants from both countries provided updates on recent developments in their respective banking sectors, discussing banking trends and emerging vulnerabilities and risks in the sector.

"Scope for augmenting knowledge on Central Banking Digital Currency (CBDC) through mutual learning was explored. Participants discussed international developments regarding crypto assets, and the importance of robust global approaches, and progress in delivering the G20 Roadmap," the joint statement said.

The recent collapse of crypto exchange FTX and the ensuing sell-off in crypto markets have placed a spotlight on the vulnerabilities in the crypto ecosystem.

Crypto assets are self-referential instruments and do not strictly pass the test of being a financial asset because they have no intrinsic cash flows attached to them.

US regulators have disqualified Bitcoin, Ether and various other crypto assets as securities.

Participants discussed matters relating to the insurance sector, including UK updates on Solvency II reforms and a consultation on the introduction of an Insurer Regulation Regime.