“Crypto Needs Policies to Protect Economies and Investors”

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The International Monetary Fund (IMF) believes there needs to be more comprehensive crypto policies. The implementation of effective policies has become a priority for the authorities, after the failure of certain exchanges.

JUST IN: International Monetary Fund says it’s important not to grant #crypto “official currency or legal tender status”.

— Watcher.Guru (@WatcherGuru) July 24, 2023

According to an official statement on digitalization last week, the IMF presented an assessment of the macroeconomic implications of crypto assets to the G20 Presidency earlier this year. In particular, the IMC recommends:

“To protect national sovereignty, it is important not to grant crypto-assets official currency or legal tender status. This would require accepting them in many jurisdictions for payment of taxes, fines and debt settlements, and could generate fiscal risks to public finances and could threaten financial stability or rapid inflation.

International Monetary Fund

Crypto assets are increasingly used around the world. Reliance on digital assets and currency is becoming more important for some global economies. Therefore, the IMF believes that there must be strict regulations and policies to protect those who invest in the currency to come.

Also Read: Banning Crypto May Not Be the Best Approach: IMF

If it becomes acceptable for payments such as taxes and other debts, crypto may become more intertwined with everyday life. This can pose a risk to public finances, hence the importance in the IMF’s view of preventing this from happening.

Source: The World Economic Forum

Also Read: IMF Launches Development of Global Digital Currency Platform

The IMF sees Terra’s collapse as a clear warning to allow crypto to become legal tender, and that there should be stronger crypto policies. They add, “By taking a holistic approach and implementing these recommendations, policymakers can preserve monetary sovereignty, protect investor interests, and promote financial stability in the digital age.”

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