IMF Finally Notices The Rise of Cryptocurrencies

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The realm of coinage or money is shifting. The birth of digital technology brought a new way of accepting payment without the need of transacting with real money nor the need to negotiate with the bank.

The future of banking was made possible because of cryptocurrency. Just recently Bitcoin the leading cryptocurrency in the market maintained its dominance as it is nearing its six-thousand dollar price.

With all these exciting news,  questions remain – Why should we invest in cryptocurrency?  Should we remain positive and serious in cryptocurrency?

These are valid questions that most newbies in the crypto-world keep on asking.

‘We are about to see massive disruptions’: IMF’s Lagarde says it’s time to get serious about digital currency

  • “I think that we are about to see massive disruptions,” IMF Managing Director Christine Lagarde told CNBC about developments in financial technologies
  • Lagarde didn’t rule out that the IMF could at some point develop its own cryptocurrency

International Monetary Fund Managing Director Christine Lagarde holds a news conference at the IMF headquarters January 17, 2013 in Washington, DC

IMF’s Lagarde: ‘We are about to see massive disruptions’  

It’s time for the world’s central banks and regulators to get serious about digital currencies, according to the head of the International Monetary Fund.

Global financial institutions are taking risks by not watching and understanding emerging financial tech products that are already starting to shake up the financial services and global payments system, according to IMF Managing Director Christine Lagarde.

“I think that we are about to see massive disruptions,” Lagarde told CNBC in a Facebook Live interview on the sidelines of the IMF Annual Meetings in Washington D.C.

Asked whether she agreed with JPMorgan Chase CEO Jamie Dimon’scomments that bitcoin is a “fraud,” Lagarde said it’s important to look at the broader implications of technologies like digital currencies.

“I think we should just be aware of not categorizing anything that has to do with digital currencies in those speculation, ponzi-like schemes,” she said. “It’s a lot more than that as well.”

Lagarde didn’t rule out that the IMF could at some point develop its own cryptocurrency. She pointed to the IMF’s Special Drawing Right (SDR), a currency the IMF created to serve as an international reserve asset, that could incorporate technology similar to cryptocurrencies.

IMF's Lagarde won't rule out the IMF potentially developing its own cryptocurrency

IMF’s Lagarde won’t rule out the IMF potentially developing its own cryptocurrency  

“What we will be looking into is how this currency, the special drawing right, can actually use the technology to be more efficient and less costly,” she said.

Lagarde moderated a panel discussion on Thursday focused on fintech and the role of central banks, featuring central bank officials and executives from fintech companies. Lagarde told CNBC she expects the IMF will play a role in regulating the fintech industry going forward.

“My hope is that we can participate in that process because I see that as a very cross-border process,” she said.

IMF director Lagarde expects IMF will play a role in regulating the fintech industry

IMF director Lagarde expects IMF will play a role in regulating the fintech industry  

Fintech, Lagarde said, is already causing disruptions in the financial services industry as new technologies lower the cost of financial transactions. She pointed to distributed ledger technology like blockchain that can help make the banking system more inclusive.

“I think of women in some of the developing countries that have to carry cash around who are at risk of violence and all the rest of it,” she said. “If they can use their cell phone and operate in a much more discreet and efficient way, it would be terrific.”

Via CNBC


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