Representatives from 20 countries who are currently gathered in Buenos Aires for a G20 summit are approaching a consensus that the digital tokens commonly referred to as cryptocurrencies are assets rather than currencies, according to reports. G20 ministers are slated to discuss digital currencies this afternoon.
A draft of a G20 communique apparently relates that this is because they "lack the traits of sovereign currencies." If formally defined as assets, cryptocurrencies could be subject to capital gains taxation in other G20 countries, as they already are in the United States.
Referring to the tokens, Dutch central bank president Klaas Knot reportedly said:
"Whether you call it crypto assets, crypto tokens – definitely not cryptocurrencies – let that be clear a message as far as I'm concerned, I don't think any of these cryptos satisfy the three roles money plays in an economy."
In February 2018, Bank of England governor Mark Carney said that cryptocurrencies have "failed" to behave as currencies because they are not an effective "store of value" and because "nobody uses [them] as a medium of exchange."
In a notable counterpoint to this narrative, FINMA, a financial regulatory body serving Switzerland (not a G20 member), issued guidelines in February that described four different genres of cryptocurrencies: payment tokens, utility tokens, asset tokens, and hybrid tokens, which bear characteristics of several token types.
In a letter to G20 finance leaders that was published on March 18, Carney, writing in the capacity of Financial Stability Board chair, said that cryptocurrencies currently pose no risks to financial stability but that they might someday.