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A joint report released by the International Monetary Fund (IMF) and the Financial Stability Board (FSB) has warned against complete bans on cryptocurrencies. The paper, titled Crypto-Assets: Implications for Financial Stability, was released today.
The report noted that cryptocurrencies cannot currently be labelled as a threat to global financial stability, but could become one in the future. Thus, a total ban on cryptocurrencies and crypto-related services would be misguided. The report suggested that countries should consider different regulatory approaches, such as introducing robust anti-money laundering and counter-terrorist financing rules. It also recommended that “care should be taken not to stifle innovation.”
The FSB and IMF also highlighted the potential of blockchain technology, suggesting that it could add efficiency to the existing financial system. However, they cautioned that the scope of its use must be limited to reduce potential risks.
The FSB is an international body that monitors and makes recommendations about the global financial system. It is composed of representatives from the G-20 countries, the European Commission, the European Central Bank, and other international organizations. The IMF is a global economic body that provides technical assistance and policy advice to its member countries.