Cryptos have gained so much popularity in financial systems that some countries recognize them as currency. An option, generally appropriate, because the countries that make this choice do so on purpose. Except that this choice does not always suit the International Monetary Fund (IMF).
IMF calls for rejection of digital assets as legal tender
The International Monetary Fund (IMF) does not want to hear about cryptos. In any case not as legal tender having legal tender in the 190 States of the globe that it covers. It is the opinion that the organization has defended in a recent blog post.
The institution stresses the importance of favoring sovereign fiat currencies over cryptos. This, she says, is to preserve the integrity of financial systems that would be threatened by crypto adoption.
In other words, the IMF thinks that using cryptos to pay taxes, fines or debts would be dangerous. Risks which would be fiscal, but which moreover could lead to an increase in inflation. This destabilizes its financial arrangements.
As a result, the IMF warns states against granting cryptos official currency status. To ignore this alert is, according to him, to put the sovereignty of States to severe tests. While the challenge is to protect it.
It is for this reason that the IMF recommends that States adopt transparent and coherent monetary policies. These would help them meet the challenges that cryptos presently pose. Among these is tax evasion which would reduce government revenue.
It must be said that as the bank of nations, the IMF is within its rights. Indeed, it provides financial assistance to countries facing economic difficulties. This, by advising them on the strategies to put in place to support their savings.
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