IMF Says Crypto Boom Poses Challenges to Financial Stability

The organization says more regulation is needed.

Oct 1, 2021 at 3:05 p.m. UTC
Updated Oct 1, 2021 at 3:42 p.m. UTC

Tanzeel Akhtar is a reporter based in London,UK.

The International Monetary Fund (IMF) said more regulation is needed as the burgeoning cryptocurrency industry poses a number of challenges and risks to financial stability.

  • The industry suffers from a lack of robust operational, governance and risk practices, according to a blog post on the organization’s website.
  • Those shortcomings put consumers at risk, the authors wrote, suggesting that some crypto tokens that have failed to survive were “likely created solely for speculation purposes or even outright fraud.”
  • “The (pseudo) anonymity of crypto assets also creates data gaps for regulators and can open unwanted doors for money laundering, as well as terrorist financing,” they wrote.
  • The authors highlighted this month’s Global Financial Stability Report, another IMF report that describes in detail a number of the risks posed by the unregulated cryptocurrency market.
  • The adoption of crypto assets is also difficult to measure, and it is possible that emerging markets and developing economies may be leading the way.
  • Regulators worldwide need to act together on crypto to take action that will allow “the benefits to flow but, at the same time, also address the vulnerabilities.”
The Festival for the Decentralized World
Thursday - Sunday, June 9-12, 2022
Austin, Texas
Save a Seat Now

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

CoinDesk - Unknown

Tanzeel Akhtar is a reporter based in London,UK.

CoinDesk - Unknown

Tanzeel Akhtar is a reporter based in London,UK.

Trending

1
CoinDesk - Unknown
How to Get Started in The Sandbox

Here's a step-by-step guide on what you need to know to explore and play in The Sandbox metaverse. This piece is part of CoinDesk's Metaverse Week.

Here's a step-by-step guide on what you need to know to explore and play in The Sandbox metaverse. This piece is part of CoinDesk's Metaverse Week.

CoinDesk - Unknown
2
CoinDesk - Unknown
Nexo

CoinDesk - Unknown
3
CoinDesk - Unknown
Martin Shkreli Is Back. He Loves Crypto

The flawed former hedge fund manager is looking to reinvent himself as a crypto entrepreneur. Buyer beware.

The flawed former hedge fund manager is looking to reinvent himself as a crypto entrepreneur. Buyer beware.

CoinDesk - Unknown
4
CoinDesk - Unknown
Using Crypto to Bring the Metaverse Into Reality

Where blockchain fits into building the next-gen internet revolution. The article is part of "Metaverse Week."

Where blockchain fits into building the next-gen internet revolution. The article is part of "Metaverse Week."

CoinDesk - Unknown