On the sidelines of the G20 meeting in India, IMF managing director Kristalina Georgieva said the agency would prefer to regulate crypto than an outright ban.
The International Monetary Fund (IMF) will prefer to diversify and regulate crypto-assets rather than impose a ban, although the nuclear option will remain on the table for now.
Speaking on the sidelines of the G20 finance ministers’ meeting in Bengaluru, India, IMF Managing Director Kristalina Georgieva explained how the UN financial institution views digital assets and what it would like to see in a regulatory framework. “We are very much in favor of controlling the world of digital money,” and that is the most important thing, he said.
In an interview published by Bloomberg on February 27, he responded to a question about his recent comments about a comprehensive cryptocurrency ban. He said there is still a lot of confusion in the regulation of digital currency. Fully regulated stablecoins create “realistic opportunities for wealth,” but unregulated crypto assets are speculative, high risk, and unprofitable, he added.
Citing a recent document in support of global regulatory standards, he said that crypto-assets cannot be legal tender because they do not support it. However, the option of banning cryptocurrencies “should not be taken off the table” if they begin to pose a significant risk to financial stability, he warned.
Still, good standards, predictability, and consumer protection would be a better option, and bans would not be considered, Georgieva said. When asked what could be the reason for the decision to ban crypto, he said that the inability to protect consumers in the rapidly changing world of crypto assets will be the main motivation.
The IMF, the Financial Stability Board, and the Bank for International Settlements are working together to provide guidance and guidance in the second half of the year.
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