International Monetary Fund (IMF) has warned against the adoption of Crypto currency, saying it can threaten financial stability of emerging markets.
- According to the IMF, Crypto currency poses new challenges to financial stability and consumer protection risks remain substantial given limited or inadequate disclosure and oversight.
- The total market value of all the crypto assets surpassed 2 trillion dollars as of September 2021, a 10-fold increase since early 2020.
- IMF’s financial experts said, anonymity of crypto assets also creates data gaps for regulators and can open unwanted doors for money laundering, as well as terrorist financing.
- Although authorities may be able to trace illicit transactions, they may not be able to identify the parties to such transactions, they said.
- Additionally, the crypto ecosystem falls under different regulatory frameworks in different countries, making coordination more challenging, IMF said.