The International Monetary Fund has called for International Cryptocurrency Regulatory Cooperation due to the potential risks of surging cryptocurrency prices. The news follows the announcement from the US Financial Stability Oversight Council about the creation of a special working group, which closely focuses on cryptocurrencies.
22 January, AtoZForex – The global organization that looks into strengthening global monetary support and financial stability, the International Monetary Fund (IMF), has spoken in regards to the cryptocurrency market. The organization is concerned about the possibility of market chaos in case of surging prices of digital currencies.
IMF Calls for International Cryptocurrency Regulatory Cooperation
The IMF has called for international Cryptocurrency regulatory cooperation, also warning about the risks of rising cryptocurrency prices. Reportedly, IMF spokesman Gerry Rice stated that there is a need for “greater international discussion and cooperation among regulators.” He has added:
“When asset prices go up quickly, risks can accumulate, particularly if market participants are borrowing money to buy. It’s important for people to be aware of the risks and take the necessary risk-management measures.”
Mr. Rice has further stated that cryptocurrencies pose threats that are bigger than just investors’ losses. He warned that cryptocurrencies might be potentially used for money laundering, terrorist financing, tax evasion and fraud.
Christine Lagarde Warns about Cryptocurrencies
Back in September 2017, the IMF has already suggested implementing a balanced approach on cryptocurrency regulation. That time, the Chief of the organization, Christine Lagarde, has stated that digital currencies might provide traditional government-issued currencies with a “run for their money.” In addition, she stated that it is “not wise” to ignore them.
Christine Lagarde also added that cryptocurrencies would potentially bring “massive disruptions.” She warned the public that central banks and financial services would need to be more attentive to this technology.
The remarks from IMF’s Rice emerge following the U.S. Treasury Secretary Steven Mnuchin’s comments from last week. He has stated that the Financial Stability Oversight Council has created a working group for discussion purposes with other US regulators. He has noted that the group was very focused on cryptocurrencies.
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