The International Monetary Fund (IMF) released a set of policies for the emerging markets and developing economies to ensure financial stability amid global crypto adoption.
The IMF believes in the potential of crypto assets as a tool for faster and cheaper cross-border payments, citing the dramatic increase in the value of the crypto markets despite the bearish trends from May 2021. The report attributes high returns, transaction costs and speed and reduced Anti-Money Laundering (AML) standards as the primary drivers for crypto adoption.
To counter the resultant financial stability challenges as a result of increased trading of crypto assets, IMF recommends that:
“Policymakers should implement global standards for crypto assets and enhance their ability to monitor the crypto ecosystem by addressing data gaps. Emerging markets faced with cryptoization risks should strengthen macroeconomic policies and consider the benefits of issuing central bank digital currencies.”
The IMF report shows that the crypto market valuation has expanded beyond Bitcoin (BTC), along with a sharp increase in stablecoin offerings