Explanation:
The Bali Fintech Agenda (BFA) emphasizes a balanced approach to leveraging financial innovation while addressing associated risks. The recommended action in this scenario aligns with the BFA’s principles of:
This approach allows the central bank to maintain monetary policy control and address financial instability concerns without stifling innovation or financial inclusion.
A is incorrect: A temporary ban may sound reasonable to address immediate risks, but it contradicts the Bali Fintech Agenda’s emphasis on monitoring and adapting regulatory frameworks without resorting to outright bans. It could stifle innovation and discourage the development of more inclusive financial solutions.
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Q.6421 A developing nation with a history of currency volatility and limited access to traditional banking services has witnessed a surge in the use of unbacked crypto assets for cross-border remittances and local transactions. While this has facilitated easier and faster transactions for some citizens, the central bank is concerned about the potential for financial instability and the erosion of its monetary policy control. The government is considering various regulatory options, ranging from a complete ban on crypto assets to the development of a national digital currency. Given the context of the Bali Fintech Agenda (BFA), which of the following actions would be MOST consistent with its recommendations?
A
Implementing a temporary ban on unbacked crypto assets until a comprehensive regulatory framework is developed.
B
Closely monitoring developments, adapting regulatory frameworks, and enhancing data infrastructure.
C
Requiring crypto exchanges to partner with local banks to improve transparency and compliance.
D
Establishing a cap on crypto transactions to limit systemic risks while allowing innovation to continue.