G20 Delhi Declaration vows to closely monitor risks of fast-paced developments in the crypto, AI

Prime Minister Narendra Modi at G20 Summit 2023. Twitter/@narendramodi

The recent G20 Summit held in New Delhi has endorsed Prime Minister Narendra Modi’s vision for India’s Presidency, which centres around the idea of “We are One Earth, One Family, and We share One Future.”

In line with this vision, the leaders of G20 nations have made a commitment to address existing digital disparities and expedite advancements in inclusive and sustainable development. For that, they acknowledged the need to regulate certain technologies in a human-centric way.

Regulating and drafting policies around crypto and other digital assets
The G20 Leaders have committed to monitoring the risks associated with the rapid developments in the crypto ecosystem and other digital assets and endorsed the high-level recommendations of the Financial Stability Board (FSB). This means regulating, supervising, and overseeing activities and markets involving crypto-assets, as well as global stablecoin arrangements.

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The G20 Leaders also took note of the roadmap designed by FSB and other supervisory bodies to support a coordinated and comprehensive policy and regulatory framework. This framework will take into consideration the various risks, particularly those specific to emerging markets and developing economies (EMDEs). The leaders also emphasised on the need for a Financial Action Task Force (FATF) to combat money laundering and terrorism financing risks on a global scale.

Finance Ministers and Central Bank Governors of the member countries will deliberate on advancing the Roadmap during their meeting scheduled for October 2023. The leaders aldo acknowledged the insights provided in the BIS Report “The Crypto Ecosystem: Key Elements and Risks.”

Exploring the Impact of Central Bank Digital Currency
The G20 leaders acknowledged that there might be some potential macro-financial consequences that may arise from the introduction and widespread use of Central Bank Digital Currencies (CBDCs) and are looking to explore the impact of CBDCs on cross-border payments and their implications for the international monetary and financial system.

They also took note of the insights shared in the BIS Innovation Hub (BISIH) Report titled “Lessons Learnt on CBDCs,” and will be paying close attention to IMF’s report on the potential macro-financial effects of the adoption of CBDCs.

Ensuring AI is developed responsibly and for the good of all
To ensure that AI is developed, and used responsibly, the G20 leaders accepted that they must address key principles such as the protection of human rights, transparency, fairness, accountability, regulation, safety, human oversight, ethics, bias mitigation, privacy, and data protection.

At the same time, they also need to let AI be developed to its full potential in a way that benefits everyone equitably, all the while managing risks associated with AI. For that, G20 Members will work together to promote international cooperation and further discussions on international governance for AI.

For this, the leaders reaffirmed their commitment to the G20 AI Principles established in 2019 and pledged to share information about how AI can be used to address challenges in the digital economy.

The leaders also commit to adopting a regulatory and governance approach that encourages innovation while considering the risks associated with AI, ensuring that benefits are maximized and risks minimized.

They will also actively promote the responsible application of AI to help achieve the Sustainable Development Goals (SDGs), emphasizing its positive impact on various aspects of society.