- IMF chief, Kristalina Georgieva urges the world to set clear rules and infrastructure to avoid the risks of crypto assets.
- Korea’s Finance stresses the need for authorities to respond to the rise of digital money.
- IMF to review cases of digital currency.
Regulating digital currency is a top priority on the global agenda, according to International Monetary Fund (IMF) Managing Director Kristalina Georgieva.
She disclosed this at a recent international conference held in Seoul while adding that stakeholders must consider the effects when crypto assets become widespread.
The event was co-hosted by the Financial Service Commission (FSC), the Ministry of Finance, the Bank of Korea, and the International Monetary Fund (IMF) with the theme “Digital Money: Navigating a Changing Financial Landscape.”
Georgieva further emphasized the potential risks posed by the ever-increasing prevalence of cryptocurrencies and why a regulatory framework must be made to counter these risks while fostering innovation.
She advised policymakers and authorities to either actively embrace and improve the development of digital currencies or face the risk of being left behind.
However, the IMF representative warned that the increasing adoption of cryptocurrencies is capable of harming macro-financial stability, causing potential issues with capital flow management, monetary policy transmission, and fiscal sustainability as a result of volatile tax collection.
IMF Conference Addresses the Need to Create a CBDC
The IMF chief acknowledged that increased crypto asset adoption is capable of undermining macro-financial stability, such as by limiting monetary policy transmission, fiscal sustainability, and capital flow management measures.
Participants at the two-day conference also discuss measures for digital money, including regulations and infrastructure, as well as the need to create a central bank digital currency.
In his address, Seoul’s finance minister Choo Kyung-ho said that despite several challenges, it is evident that the transition to digital money is already happening, and it cannot be stopped.
So in this regard, they are already setting plans to formulate policy tools that will support economic growth and financial innovation as well as ensure the reliability and stability of digital currency.
The last panel discussion of the day evaluated the roles of standard-setting bodies in the crypto ecosystem, inviting the likes of Steven Maijoor, the executive board of De Nederlandsche Bank, an official from the Financial Services Commission, and Neil Esho, secretary general from the BIS, amongst others as panelists.
How will Crypto be Impacted?
International Monetary Fund Managing Director Kristalina Georgieva’s remarks at the Digital Money: Navigating a Changing Financial Landscape conference have set a direction for the future of crypto regulation.
Her emphasis on creating a balanced approach that nurtures innovatandsand your financial environments resonates with the general financial community’s current sentiment.
The IMF takes a different approach to crypto than the Securities and Exchange Commission (SEC) and the US Treasury.
The IMF emphasizes the need to create a comprehensive, coordinated, and consistent policy approach to crypto based on three main goals: a sound precise legal treatment and detailed rules, a macro-policy foundation, and practical implementation.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.