IMF Opposes Use of Cryptos as Legal Tender

The IMF Board of Directors makes a new statement regarding crypto assets. In a recently published document, he returns to the general principles of the ecosystem, highlighting his impressions. However, some details could divide opinions between followers of digital assets and the Fund.

The IMF, against the widespread adoption of crypto assets

The expansion of cryptocurrencies is causing a lot of ink and saliva to flow. While more and more people are getting into it, some institutions such as the International Monetary Fund (IMF) do not see things the same way. Additionally, the adoption of bitcoin (BTC) as legal tender in El Salvador in September is the straw that broke the camel’s back.

Faced with the omnipresence of these assets, the fund published a document of nine policy principles made public on February 23, 2023. These deal with legal, macro-financial, regulatory and international coordination issues.

The first principle concerns the use of cryptocurrencies as legal tender. According to the Fund, digital assets should not be granted legal status, let alone that of official currency. After reading the document on February 8, the IMF board gave it its support and even thought that the Fund could serve as a thought leader in the adoption of cryptos.

Digital assets have undeniable advantages

The IMF does not automatically condemn all digital assets. Last year, Kristalina Georgieva, the managing director of the Fund said that there are several types of assets. For her, CBDCs and stablecoins represent less risk than cryptocurrencies that are not backed by any financial institution.

Therefore, the issuers of each type of asset must assume their responsibility. In September 2022, the Fund announced that it was working on an interoperable CBDC platform. For him, if cryptos are to be promoted, central bank digital currency would be the best option.

The International Monetary Fund recommends taking tweezers with cryptocurrencies. According to him, monetary sovereignty and stability must be protected. Therefore, a widespread adoption of crypto assets could harm the latter.

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