The International Monetary Fund (IMF) chief said on Thursday that crypto currencies must be regulated because they threaten financial stability.
During the opening speech of a conference on digital currencies in Seoul, Kristalina Georgieva, the managing director of the IMF, stated, “The challenge is that high crypto asset adoption could undermine macro-financial stability.”
Due to erratic tax collection, she claimed that widespread adoption of crypto assets may have an impact on the efficiency with which monetary policy is implemented, capital flow management strategies, and fiscal sustainability.
“Our goal is to make a more efficient, interoperable and accessible financial system by providing rules to avoid the risks of crypto and infrastructure by leveraging some of its technologies,” Georgieva said at the joint conference with the South Korean government and central bank.
Rules are not meant to “return us to a pre-crypto world, nor to squash innovation,” she said.
“Good rules can spur and guide innovation.”
When it comes to the development of digital money, Georgieva said in a panel discussion that policymakers could either be part of it and help do it better or be left out of it – because it would be done anyway.
There is “tremendous interest” in learning from each other, with the “biggest interest” in learning from emerging markets, she said, pointing to India specifically for its digital public infrastructure.
Advanced economies’ experience in their own history of money is also very valuable, Georgieva said.
