IMF Chairwomen: ‘We Should Consider Issuing Central Bank Digital Currencies’
Christine Lagarde, from the International Monetary Fund (IMF), has affirmed that governments and central banks all over the world should work towards setting up their own cryptos. The statement was made at the Singapore Fintech Festival, which is happening this week in Singapore.
According to her, a central bank would be an important starting point for a rapid expansion into developing economies which could reach some of the world’s poorest countries without all the risks that private blockchains and cryptos have.
There are many central banks around the world which are currently considering the idea of issuing digital currencies. Some of them are Canada, China, Sweden and Uruguay. Lagarde has affirmed that these banks are embracing a new way of thinking, just like the IMF is right now.
She has also noted that major cryptos like Bitcoin (BTC), Ethereum (ETH) and Ripple’s XRP are also trying to reinvent themselves to offer more opportunities for the investors. A new report from the IMF affirms that many cryptos are struggling to be like money because of their erratic valuations and their great volatility.
Cryptos As The “Least Attractive Option”
However, the IMF does not seem to like cryptocurrencies a lot. The bank has affirmed that, after you consider many different alternatives of digital and cash money, cryptos are the least attractive option.
Why? Because they are technologically limited and, while these tech issues are not solved, they are still a lot less efficient than other forms of money. However, this does not seem like a reason to abandon the cryptos just yet.
Lagarde sees risks in adopting digital currencies but has affirmed that they hold great promises in terms of financial inclusion and that they are good for anti-money laundering measures because they are easy to track.
She affirms that experimentation has to be made and that exploring these alternatives is the only healthy way to discover more about these assets.
Lagarde says that there are clear advantages in doing this and that payment with cryptos can be safe, cheap and “semi-anonymous”. The blockchain has clear advantages so the focus should be on getting better and highly structured organizations like national state banks could be useful for that.
Not Everybody Likes The Idea of Centralized Cryptos
Obviously, not everybody likes the idea of bank-supported cryptos. NewsBTC, for instance, while commenting on the story, has affirmed that the crypto community is possibly very cautious with this new idea as centralized organizations can often be manipulated by governments.
The article cited the United States forcing SWIFT, an “independent” European financial organization, to stop serving Iran. Geopolitics are generally very muddled and complicated, though, so any state-based crypto will have this “vulnerability”.
However, some “decentralized” cryptos are very centralized, too. The main difference is that they are created around the figure of foundations and developers instead of governments, but decentralization is a very hard dream to actually achieve, that much is right.