The International Monetary Fund (IMF) has said that a ban on cryptocurrencies “may not be effective in the long term.”
The comment is director Promoting Central Bank Digital Currencies (CBDC) in Latin America and the Caribbean (LAC). The report said the LAC countries are “at the forefront of digital money adoption,” and separated the term digital money into CBDC and crypto-assets.
Regarding the latter, the post noted that Brazil, Argentina, Colombia, and Ecuador ranked high in Chainalysis’ list of top 20 countries for global crypto adoption, suggesting that crypto investors in these countries are “noticing that digital assets provide And they are seeking the benefits they claim.” :
“Protecting against uncertain domestic macroeconomic conditions, avoiding capital controls, improving financial inclusion for the unbanked, cheaper and faster payments, and stronger competition.”
At the same time, historical factors such as macroeconomic instability, low institutional credibility and corruption pose challenges and risks to cryptocurrency adoption, especially for “vulnerable LAC countries,” the IMF said. rice field.
In contrast, an IMF survey of LAC government officials found that most respondents viewed CBDCs as “a means of strengthening payment systems and expanding access,” namely through financial inclusion and stablecoins and cryptocurrencies. He answered that he sees restraint on currency substitution as an advantage.
crypto risk
To continue to harness the potential benefits of cryptocurrencies while mitigating risks, the IMF has provided appropriate policy responses. guidance. Includes advice on:
- defend monetary policy
- manage the flow of capital
- Incorporate an ambitious cryptocurrency tax regime
- Establish legal certainty about digital assets
- rigorously monitor
- Establishing an oversight framework across government agencies and authorities
- Monitor monetary system impact
- strengthen global cooperation on this issue
Additionally, the IMF has banned cryptocurrencies in some countries, but said this policy strategy may not work in the long run. He added that countries should instead address factors related to cryptocurrency demand.
“Instead, we will focus on addressing the drivers of cryptocurrency demand, such as the unmet needs of the public for digital payments, and increasing transparency by recording cryptocurrency transactions in national statistics.”
IMF Warns Crypto Ban May Not Be An Effective Long-Term Strategy, First Posted On CryptoSlate.
