Remarks by Martin Moloney at the IIF Digital Assets Roundtable

25 April 2025

Remarks by Martin Moloney, Deputy Secretary General, Financial Stability Board, at the International Institute of Finance Digital Assets Roundtable, Washington DC, 25 April 2025.

The views expressed in these remarks are those of the speaker in his role as FSB Deputy Secretary General and do not necessarily reflect those of the FSB or its members.

Thank you for convening this important discussion on digital assets.

While I accept the merit of speaking of digital assets collectively, I see the path forward for crypto-assets and tokenised assets as involving such profoundly different challenges that I hope you don’t mind if I speak about each in turn. The fact that both use DLT technology and promise the benefits of smart contracts seems to me to hide how radically different their challenges are.

Tokenised Assets

When it comes to tokenisation of assets already trading and settling by traditional means, it seems to me, that the core issue in the path forward is a coordination problem within the financial sector and not any of the potential financial stability concerns that we have previously flagged. How does the industry take steps forward which at each stage of the evolution create the optimal balance between using common standards, providing utility-type services and reaping the benefits of competitive innovation?

As we sit here, it remains unclear to me that the optimal path forward is emerging out of the competitive process, one that would involve short-term benefits for innovators and long-term scalability. I would be interested to hear from others who think the path forward is clear and – with all due respect to everyone involved in the conversation – I’m more interested to hear the views of those who are not talking up their own products. Sorry to be blunt.

What seems to me critical is to identify a profitable revenue model for early movers that does not depend on a scenario of a rapid positive, expanding spiral of impact prefaced on a wide number of market participants moving nimbly to achieve the potential cost savings. That model has credibility issues.

That said, regulation should not be the binding constraint. We have published a report which identifies certain risks if tokenisation is not done prudently; but they raise no fundamental issue for now. If, for example, those initiating the development of tokenised products build into their product design the generation of suitable – I would suggest unlagged – data to pass on to authorities and if tried and tested legal frameworks are used to achieve payment finality etc, I cannot see authorities having any significant concern.

If a revenue model cannot spontaneously emerge, I recognise that advocates may turn to the state in its various forms either, for example, to take the lead by tokenising treasuries or by putting in place CBDCs so that the problem of financing the early phases of development can, effectively, benefit from a state subsidy. These kinds of initiatives are outside our terms of reference in the FSB, but I see no fundamental financial stability issue with them.

The other question I do not know the answer to is whether, by developing standards for digital registration or some other initiatives, there might be some sort of middle course in terms of state involvement. Either way, I do not see that regulation and financial stability are or should be the binding constraint.

Crypto-assets

The situation with so-called native digital assets, crypto, is very different. Crypto-assets have, in their own slightly bizarre way, solved the question of how to grow in stages.

Regulation is now a crucial, potentially binding, constraint. The ongoing evolution of regulatory frameworks, including the EU’s Markets in Crypto-Assets Regulation (MiCAR) and U.S. reforms under legislative debate, highlights the growing recognition, already realised by some global standard setters some years ago, that the regulatory issue is pressing.

In October, we will deliver a thematic peer review to the G20 on the implementation of the FSB’s global regulatory framework for crypto-asset activities. This review will assess progress by FSB members and select non-members in developing regulatory frameworks for crypto-assets and stablecoins, addressing regulatory data gaps, and cooperating across borders.

The increasing interlinkages between crypto-assets and traditional financial systems require careful oversight to prevent risks to financial stability. As digital forms of money and assets interact with digitally native instruments, ensuring these systems are resiliently interoperable is critical.

Stablecoins

Stablecoins remain a key focus. They are incredibly dangerous; but note that the FSB has never proposed to prohibit them. The FSB’s Global Stablecoin Recommendations call for robust legal claims, effective stabilisation mechanisms, and prudential requirements to mitigate risks such as runs on the issuer and asset fire sales.

Cross-border cooperation and oversight are essential to address their global implications.

Cross-border cooperation is a significant challenge. Enhanced international cooperation is necessary to sufficiently harmonise regulatory standards and address operational complexities, since crypto native companies operate across borders to a greater extent than similarly sized or nascent traditional financial services firms. These are inherently global products. They have no home. Our constantly self-limiting approach to international coordination will always be challenged by them. We need to respond vigorously.

The scenario in which one or more imprudently designed stablecoins trade and grow across borders to infect major global financial systems with unbearable risk is a clear danger. We know how to regulate them to allow them to grow safely. We have set that out. There merely has to be the will to keep the system safe.

Let me close my opening remarks with that thought.

FSB Chair calls for continued vigilance on financial sector vulnerabilities

23 April 2025

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Ref: 9/2025

  • In his letter to G20 Finance Ministers and Central Bank Governors, FSB Chair Klaas Knot notes that recent financial market turmoil underscores the importance of robust surveillance, proactive policymaking, and international coordination.
  • Letter highlights the role played by non-bank entities in periods of recent market turmoil and the need to enhance regulation and monitoring of this critical sector.
  • Letter emphasises the need for continued reform implementation and international cooperation to ensure a resilient financial system.

The Financial Stability Board (FSB) today published a letter from its Chair, Klaas Knot, to G20 Finance Ministers and Central Bank Governors ahead of their meeting on 23-24 April.

The letter, Mr Knot’s final one as FSB Chair, comes at a time of heightened financial market volatility and geopolitical risks. Reflecting on recent episodes of financial market turmoil, Mr Knot emphasises the importance of vigilance and international cooperation to address emerging risks and ensure the continued resilience of the financial system.

The letter highlights the role played by non-bank financial entities in recent periods of market turmoil, outlining the FSB’s work to strengthen the resilience of non-bank financial intermediation (NBFI). The FSB is finalising recommendations to address financial stability risks arising from leverage in NBFI that will be delivered to the G20 in July, marking a significant step in bolstering the sector’s resilience.

The letter also notes the FSB’s work to address cyber risks, which have culminated with this month’s release of the FSB’s Format for Incident Reporting Exchange (FIRE); and work to enhance cross-border payments, where efforts are focused on intensifying the FSB’s engagement with the private sector and regulators to encourage implementation of the G20 Roadmap. The letter reflects on the FSB’s unique role in fostering international cooperation to address financial stability challenges and calls on authorities to remain committed to implementing the agreed international reforms in order to preserve financial stability in an evolving risk environment and avoid fragmentation.

Notes to editors

The FSB coordinates at the international level the work of national financial authorities and international standard-setting bodies and develops and promotes the implementation of effective regulatory, supervisory, and other financial sector policies in the interest of financial stability. It brings together national authorities responsible for financial stability in 24 countries and jurisdictions, international financial institutions, sector-specific international groupings of regulators and supervisors, and committees of central bank experts. The FSB also conducts outreach with approximately 70 other jurisdictions through its six Regional Consultative Groups.

The FSB is chaired by Klaas Knot, President of De Nederlandsche Bank. The FSB Secretariat is located in Basel, Switzerland and hosted by the Bank for International Settlements.

FSB Chair’s letter to G20 Finance Ministers and Central Bank Governors: April 2025

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The global risk outlook has become more challenging amid increased trade and economic policy

uncertainty.

This letter was submitted to G20 Finance Ministers and Central Bank Governors (FMCBG) ahead of the G20’s meeting on 23-24 April.

As his term as FSB Chair nears its conclusion on 1 July 2025, Klaas Knot reflects on the progress made in addressing global challenges to financial stability and outlines priorities for the future. The letter notes the challenging global risk outlook, with increased trade and economic policy uncertainty reflected in large price swings and heightened volatility in global financial markets. The letter calls on market participants and financial supervisors and regulators to remain vigilant.

Recent episodes of financial market turmoil, rapid technological advancements, and the growing threat of climate change, all underscore the need for vigilance and international cooperation.

The FSB has played a critical role in enhancing the resilience of the financial system.

The letter emphasises the importance of implementing reforms and highlights the need for sustained global coordination to address emerging risks and ensure a resilient financial system.

Format for Incident Reporting Exchange (FIRE): Taxonomy package

15 April 2025

On 15 April 2025 the FSb published a Format for Incident Reporting Exchange (FIRE), designed to streamline cyber incident reporting. To facilitate adoption of FIRE globally, the following technical supporting standards are also published and available for downloading along with the FIRE reporting requirements:

DPM Data Dictionary

This is the data dictionary, in DPM 1.0.1, providing the structured representation of the data required for FIRE reporting.

Data Point Model (DPM) is a data centric method for organising business terms and concepts hierarchically. It presents data in various reporting scenarios derived from the underlying legal requirements in a business friendly and non-technical manner. DPM bridges the communications gap between business and IT by providing a necessary common understanding. Business concepts are specified in the DPM according to formal rules required by IT specialists, while remaining manageable by policy experts and other data users.

The DPM method provides a precise, complete and unambiguous definition of terms and concepts. This enables building logical structures of information requirements (such as messages, tables, data sets or cubes) based on underlying business dictionaries that can be understood by both business and technical users. Developed through cooperation between European stakeholders, DPM is now contained in ISO 5116 and is used by various national and international regulators.

Download: FIRE DPM v1.0.1 (zip file | 422 KB)

Version history:

VersionPublication date
1.0.123 July 2025
1.015 April 2025
Validation rules

Validation rules are tests to be applied to reported data to check its consistency.

If the result of a validation rule to a set of data is true, the data reported is consistent according to that rule. If the result is false, the reported information presents an inconsistency that should be checked or corrected.

Download: FIRE validation rules v1 (xlsx file | 25 KB)

XBRL taxonomy

FIRE report with XBRL tagging to support the report submission.

eXtensible Business Reporting Language (XBRL) is a standard for digital reporting of financial, performance, risk and compliance information. It is a freely licensed, open standard available to all.

The provided XBRL taxonomy is an example. If implemented by a national authority, this taxonomy would facilitate reporting by entities in formats such as XBRL-XML or xBRL-CSV. Some jurisdictions already have existing XBRL-based reporting mechanisms, while others may choose to use different methods for implementation.

There are a variety of XBRL tools – both open source and enterprise-wide – available for institutions to facilitate the validation and creation of XBRL reports.

In its simplest form, an Excel plug-in could provide the FIRE template, and after updating, it could run the validation rule along with the generation of the submission-ready XBRL file. Institutions can explore various software solutions that meet their specific needs, including open-source options, to effectively manage their XBRL reporting requirements.

More information about XBRL and supporting software is available on the XBRL International website.

Download:

Version history:

VersionPublication date
1.0.123 July 2025
1.015 April 2025

The FSB will maintain this taxonomy package and may publish new versions of it, for example, if new DPM and/or XBRL functionalities become available.

FSB finalises the common Format for Incident Reporting Exchange (FIRE)

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Ref: 8/2025

  • FIRE is a standardised yet adaptable format to enhance the efficiency and consistency of cyber and operational incident reporting.
  • Developed in collaboration with private sector experts, FIRE reduces the reporting burden for firms operating across multiple jurisdictions and improves communication with and among authorities.
  • FIRE supports a phased implementation and is designed to be interoperable with current systems, encouraging widespread adoption.

The Financial Stability Board (FSB) has today published its finalised Format for Incident Reporting Exchange (FIRE), a global initiative aimed at streamlining cyber and operational incident reporting. By introducing a standardised format, FIRE addresses the fragmentation in reporting requirements, alleviating the burden on firms that operate across multiple jurisdictions.

At a time of heightened cyber risks and increasing reliance on technology and third-party services, the ability to respond swiftly and effectively to operational incidents – particularly cyber incidents – has become more critical than ever. FIRE facilitates timely action and fosters improved communication and coordination among authorities across borders.

Developed in close partnership with the private sector, FIRE encompasses a wide range of operational and cyber incidents. Its potential applicability extends to third-party service providers and firms beyond the financial sector. Its focus on promoting convergence and flexibility in incident reporting has garnered strong support, underscoring its practical value and relevance to stakeholders.

For jurisdictions without a standardised reporting framework, FIRE offers a robust foundation upon which they can build. For those with existing frameworks, it supports a phased implementation approach and is designed to be interoperable with current systems, ensuring a smooth transition and encouraging broad adoption.

Klaas Knot, President of De Nederlandsche Bank and Chair of the FSB, said: “FIRE demonstrates how international regulatory cooperation can deliver benefits for all stakeholders. It also highlights the value of public-private partnerships in tackling shared challenges, such as those related to cyber and operational resilience.”

Notes to editors

The finalised FIRE framework reflects public feedback received on the consultative version issued in October 2024, as well as the results of a robustness test that the FSB conducted using sanitised data from industry stakeholders.

FIRE builds on the FSB Recommendations to Achieve Greater Convergence in Cyber Incident Reporting, published in 2023. The 2023 Recommendations included an updated cyber lexicon and a concept for developing a common format for incident reporting exchange (FIRE) as a way to achieve greater convergence in cyber incident reporting.

The FSB coordinates at the international level the work of national financial authorities and international standard-setting bodies and develops and promotes the implementation of effective regulatory, supervisory, and other financial sector policies in the interest of financial stability. It brings together national authorities responsible for financial stability in 24 countries and jurisdictions, international financial institutions, sector-specific international groupings of regulators and supervisors, and committees of central bank experts. The FSB also conducts outreach with approximately 70 other jurisdictions through its six Regional Consultative Groups.

The FSB is chaired by Klaas Knot, President of De Nederlandsche Bank. The FSB Secretariat is located in Basel, Switzerland and hosted by the Bank for International Settlements.

Format for Incident Reporting Exchange (FIRE): Final report

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Summary of document history

Summary of document history

The FSB has developed FIRE to reduce fragmentation in the reporting of cyber and other operational incidents and enhance cross-border cooperation.

Cyber and operational incidents pose significant risks to the stability of the financial system. Incident reporting serves as a critical tool for supervisors to monitor disruptions. Timely and effective incident response and recovery are essential to mitigating risks to financial stability.

This report presents the Format for Incident Reporting Exchange (FIRE), a common framework that financial firms can use to report operational incidents, including cyber incidents.

Developed in collaboration with the private sector, FIRE is a global initiative designed to promote consistency, address the challenges of reporting to multiple authorities, and enhance communication within and across jurisdictions.

FIRE provides a set of standardised information items and is designed in a way to maximise flexibility and interoperability. It covers a broad range of operational and cyber incidents and can also be used by third-party service providers and organisations beyond the financial sector. Industry practitioners have praised FIRE for its practical benefits.

For jurisdictions without a standardised reporting framework, FIRE offers a strong foundation to build upon. For those with existing frameworks, it supports phased implementation and is designed to integrate seamlessly with current systems, enabling a smooth transition and fostering widespread adoption.

To facilitate adoption of FIRE globally, the FSB is also releasing a downloadable taxonomy package, containing a data model based on the Data Point Model (DPM) method, enabling machine-readable formats of FIRE, such as in eXtensible Business Reporting Language (XBRL), as well as associated validation rules.

The FSB will hold a workshop with industry and authorities in 2027 to review the experiences with FIRE and implementation challenges.

Format for Incident Reporting Exchange (FIRE): Overview of responses to the consultation

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Summary of document history

Summary of document history

On 17 October 2024 the FSB published the Format for Incident Reporting Exchange (FIRE): Consultation report, inviting feedback on its proposed framework. During the two-month consultation period that followed, the FSB received 16 responses from stakeholders across the banking, insurance, asset management and financial market infrastructure sectors.

The consultation highlighted broad support for the objectives of FIRE, particularly its role in fostering convergence and flexibility in incident reporting frameworks. Respondents commended the FSB’s inclusive approach, of public-private sector partnership collaboration in strengthening cyber and operational resilience.

In response to the feedback, the FSB made several refinements to the final report to enhance clarity and address key concerns. These include changes to address feedback on potential challenges related to confidentiality and legal liability, as well as further guidance to promote consistent implementation across jurisdictions, and adjustments to the information items, which resulted in a net reduction in their number to streamline reporting and improve usability.

Financial Stability Board nominates Andrew Bailey to serve as its next Chair

7 April 2025

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Ref: 7/2025

The Nomination Committee for the next FSB Chair has unanimously agreed to recommend that the Plenary appoint Andrew Bailey, Governor of the Bank of England, as the next FSB Chair for a three-year term to begin on 1 July 2025. The Plenary will formalise the appointment when it meets in person in June.

Andrew Bailey currently serves as the Chair of the FSB’s Standing Committee on Supervisory and Regulatory Cooperation (SRC). The SRC addresses key financial stability risks through the development of supervisory and regulatory policies and coordinates issues that arise among supervisors and regulators to ensure effective consideration of cross-sector and international implications.

François Villeroy de Galhau, Governor of the Bank of France and Chair of the Nomination Committee said: “Andrew possesses the leadership, expertise, and vision needed to guide the FSB in achieving its objectives. We are pleased to put him forward to the Plenary as the next FSB Chair.”

Klaas Knot, President of De Nederlandsche Bank and Chair of the FSB, added “Andrew has a proven track record of fostering collaboration, having led recent key FSB reform initiatives, including on crypto-assets and non-bank financial intermediation. This positions him well to guide the FSB forward, with a focus on ensuring the successful implementation of agreed reforms.”

Andrew Bailey said: “I look forward to serving the FSB at this important time for the critical task of maintaining global financial stability and carrying on the excellent work done by Klaas Knot.

“It is at times like this that the stability of the financial system is put to the test.  That stability rests on strong regulatory standards and effective international co-operation.  The global financial crisis underscored the importance of addressing challenges collectively and strengthening the multilateral system. The FSB exemplifies this approach, ensuring a resilient and stable financial system for the future. The FSB has a vital leadership role, and I am firmly committed to continuing that role in a very rapidly changing world.”

Notes to editors

The FSB is currently chaired by Klaas Knot, President of De Nederlandsche Bank, whose term of office as FSB Chair will end on 30 June 2025.

The FSB Chair is selected from representatives on the Plenary and appointed by the Plenary for a term of three years renewable once.

The process for appointing the FSB’s Chair is set out in the FSB’s Procedural Guidelines and the Charter. In line with the agreed procedures, the FSB Plenary established a Nominations Committee in November 2024. The Nominations Committee oversees the nomination process, consults Member representatives on candidates, and proposes a final recommendation for the FSB Chair to the Plenary.

The Nominations Committee is chaired by Francois Villeroy de Galhau (Governor Banque de France). Its other members are Ayman Al-Sayari (Governor Saudi Central Bank), Shigeru Ariizumi (Vice Minister for International Affairs Japan Financial Services Agency, Chair of IAIS, Vice Chair of IOSCO), Nellie Liang (former Under Secretary for Domestic Finance U.S. Treasury and SCAV Chair), Daniela Stoffel (State Secretary for International Finance Swiss Federal Department of Finance), and Eddie Yue (Chief Executive Hong Kong Monetary Authority).

Biography

Andrew Bailey has served as the Governor of the Bank of England since 16 March 2020. From 1 July 2016 until taking up the role of Governor of the Bank of England, Andrew Bailey served as Chief Executive Officer of the Financial Conduct Authority (FCA). As CEO of the FCA, he was also a member of the Prudential Regulation Committee, the Financial Policy Committee, and the Board of the Financial Conduct Authority.

Andrew Bailey previously held the role of Deputy Governor, Prudential Regulation and CEO of the PRA at the Bank of England from 1 April 2013. While retaining his role as Executive Director of the Bank, he joined the Financial Services Authority in April 2011 as Deputy Head of the Prudential Business Unit and Director of UK Banks and Building Societies. In July 2012, Andrew Bailey became Managing Director of the Prudential Business Unit, with responsibility for the prudential supervision of banks, investment banks and insurance companies. He was appointed as a voting member of the interim Financial Policy Committee at its June 2012 meeting.

Previously, Andrew Bailey worked at the Bank of England in a number of areas, most recently as Executive Director for Banking Services and Chief Cashier, as well as Head of the Bank’s Special Resolution Unit (SRU). Previous roles include Governor’s Private Secretary, and Head of the International Economic Analysis Division in Monetary Analysis.

About the FSB

The FSB coordinates at the international level the work of national financial authorities and international standard-setting bodies and develops and promotes the implementation of effective regulatory, supervisory, and other financial sector policies in the interest of financial stability. It brings together national authorities responsible for financial stability in 24 countries and jurisdictions, international financial institutions, sector-specific international groupings of regulators and supervisors, and committees of central bank experts. The FSB also conducts outreach with approximately 70 other jurisdictions through its six Regional Consultative Groups.

The FSB Secretariat is located in Basel, Switzerland and hosted by the Bank for International Settlements.

FSB announces establishment of the Forum on Cross-border Payments Data

27 March 2025

The Financial Stability Board (FSB) today announced the establishment of a Forum on Cross-Border Payments Data. This initiative is a key outcome from the FSB’s Recommendations for data frameworks related to cross-border payments that were published in December 2024, and forms part of the FSB’s increasing emphasis on promoting implementation of its policy recommendations.

Differences in laws, regulations, and practices between countries can create unnecessary frictions in cross-border payments, increasing costs and risks for businesses and individuals. By bringing together experts in payments, anti-money laundering and countering terrorist financing, sanctions, and data privacy and protection, the Forum will work to strengthen cooperation on data-related issues in cross-border payments, such as the way data is collected, stored and managed across borders.

Working with competent international organisations, including with the Financial Action Task Force (FATF) and the Organisation for Economic Cooperation and Development (OECD), the forum will serve as a platform for dialogue, information exchange, and research, helping to identify and address inconsistencies in global data frameworks. An advisory body comprised of private sector representatives will also be created to provide industry perspectives and expertise to the Forum.

Its first meeting will be held in May and will be chaired by Gianmatteo Piazza of the Bank of Italy.

Public responses to consultation on Leverage in Non-Bank Financial Intermediation

14 March 2025

Summary of document history

Summary of document history

On 18 December 2024, the FSB published Leverage in Non-Bank Financial Intermediation: Consultation report. Interested parties were invited to provide written comments by 28 February 2025. The public comments received are available below.

Responses received

The FSB thanks those who took the time and effort to express their views. The FSB expects to publish the final report in July 2025.